Does ebay collect sales taxes on international sales?

[eastmeetswest]

I have been reshipping items for a friend in Asia and realized that in-bound items are being taxed.  Depending on value, he then has to pay a GST when he receives the items.  This "double taxation" doesn't seem fair but I'm not sure how to do a tax drawback like foreign visitors can do at their departing airports.  

So, I'm wondering if anyone knows how to avoid this double taxing?  Also, do you know if tax is collected on purchased items shipped directly overseas?

[ramtor]

Market facilitator laws are state laws.

https://blog.taxjar.com/marketplace-facilitator-explained/

State laws can not be in violation of federal laws. Any attempts to collect tax on international transaction by the state falls out of state jurisdiction. (It's governed by Congress).

The states can only collect taxes for domestic (read: in-state or inter-state) transactions.

[ramtor]

Actually I red through Marketplace Facilitator Laws for 10 states and none of them refer to international transactions. Laws do mention consumption (sales) tax which is by definition levied only on all the goods & services sold in the domestic market (both seller and buyer have to be in the same country.)
Thus it appears that marketplace vendors are being overzealous and collecting sales tax on international transactions on their own accord.

Of cause states that receive this revenue in violation of federal law will not be complaining.
Then it will be up to consumers to raise the flag.

[the*dog*ate*my*tablecloth]

US treaties do not apply to sales and use tax. Even overseas sellers will be required to comply if they meet the economic nexus thresholds. 

these MF rules were enacted because it didn’t make sense to reward buyers for going out of state to buy. It cheated instate sellers. The same thing applies to out of the country sellers. Why would their buyers be free from paying use tax by taking their purchases overseas?

This is a use tax. If buyers have to pay taxes on local businesses they should also be paying taxes when buying from strangers over the internet.

[ramtor]

maybe it's not clear:

Consumption (sales/use) tax by definition levied only on all the goods & services sold in the domestic market (both seller and buyer have to be in the same country.)

Any government treaties that regulate domestic user tax will do just that.

[ramtor]

You are an international seller who has no physical presence in the U.S., but who makes sales into the U.S.

In this case, you may have economic nexus. A June 21, 2018 Supreme Court of the United States case allowed states to require online sellers with “economic nexus” in their state to comply with that state’s sales tax requirements. In other words, due to the Wayfair ruling, even if you do not have a physical presence in a state, if you pass a state’s economic threshold for total revenue or number of transactions in that state, you’re legally obligated to collect and remit sales tax to that state.

This simply means that if a seller – no matter where they are located – makes a certain dollar amount of sales in a state, or a a certain number of transactions with buyers in that state, then they are required to collect sales tax in that state.

For example, in Kentucky, any seller (U.S. based or international) who makes more than $100,000 in sales in the state in the previous or current calendar year, or who made more than 200 sales transactions in the state in the previous or current calendar year, is required to comply with Kentucky’s sales tax laws. Compliance means registering for a Kentucky sales tax permit and collecting sales tax from any buyers in Kentucky.

About half the states in the U.S. currently have economic nexus laws. You can read more about each U.S. state’s economic nexus laws here.

[myangelandmyprincess]

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@ramtor wrote:

You are an international seller who has no physical presence in the U.S., but who makes sales into the U.S.

In this case, you may have economic nexus. A June 21, 2018 Supreme Court of the United States case allowed states to require online sellers with “economic nexus” in their state to comply with that state’s sales tax requirements. In other words, due to the Wayfair ruling, even if you do not have a physical presence in a state, if you pass a state’s economic threshold for total revenue or number of transactions in that state, you’re legally obligated to collect and remit sales tax to that state.

This simply means that if a seller – no matter where they are located – makes a certain dollar amount of sales in a state, or a a certain number of transactions with buyers in that state, then they are required to collect sales tax in that state.

For example, in Kentucky, any seller (U.S. based or international) who makes more than $100,000 in sales in the state in the previous or current calendar year, or who made more than 200 sales transactions in the state in the previous or current calendar year, is required to comply with Kentucky’s sales tax laws. Compliance means registering for a Kentucky sales tax permit and collecting sales tax from any buyers in Kentucky.

About half the states in the U.S. currently have economic nexus laws. You can read more about each U.S. state’s economic nexus laws here.

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The thresholds don’t apply to the individual sellers.  It applies to if eBay does enough business in that state so any state that has started this all eBay transactions in that state will have taxes if its a taxable item 

[the*dog*ate*my*tablecloth]

If sales and use taxes are not required on purchases from out of the country then why are all the marketplace facilitators collecting them? Do you know something that all their high priced international trade lawyers and accountants do not?

use tax is due in CA on international purchases

https://www.cdtfa.ca.gov/taxes-and-fees/use-tax.htm

use tax is due on international purchases in MA

https://www.mass.gov/service-details/individual-use-tax

Then I stopped looking

[haijacker]

You're wrong, eBay IS taxing. I just bought a few small items directly from a seller in CHINA. eBay added tax to the purchase. Are you kidding me? CHINA??? There's no tax to pay, this is just theft.

[eburtonlab]

@haijacker 

You're wrong, eBay IS taxing.

No. The state the item is shipped to is doing the taxing. eBay is collecting the tax payment from the buyer and remitting to the buyer's state.

[7606dennis]

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@haijacker wrote:

You're wrong, eBay IS taxing. I just bought a few small items directly from a seller in CHINA. eBay added tax to the purchase. Are you kidding me? CHINA??? There's no tax to pay, this is just theft.

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No, eBay is not charging sales tax.  It is collecting sales tax as required by your state's tax laws.  Since most states that charge their residents sales tax also have a use tax statute to go with it and most of these taxes have been levied decades ago, the big question is why haven't you been paying the use tax you owed all along?  Why do you now complain because eBay must now collect these taxes that you were suppose to have been paying all along.

By the way, the reason eBay collects it on purchases from China and other international locations is that the tax is determined by where you have the purchase delivered an not where the seller is located.  There are currently five states, I believe, that do not require their residents to pay sales/use tax.  So if you want to legally avoid paying it, you will need to relocate to one of those five states.

Oh!  On international purchases, in addition to your state's sales/use tax, depending upon the value of the merchandise purchased, you may also have to pay Customs' Duty if it exceeds the duty free threshold.  Of course, that is the federal government's doing and not your state's.

[nineball26]

I sure hope ebay realizes they are breakign the law here, do you know what a tax nexus is?

its a QUALIFICATION for charging taxes BY STATE!  

NOT INTERNATIONALLY!  collecting taxes internationally is ILLEGAL, merchants in China DO NOT hold a USA business license!

so who would they pay the taxes under? they have NO TAX NUMBER!!!!!

now, back to the nexus, the nexus says for ANYONE to collect taxes from any state they must qualify, and most states are $100,000 in sales the prior year OR 200 sales units..

ebay is collecting taxes without qualifying anyone? I recently bought form an individual who had a total of 12 sales since he has been a member of ebay? 

why did ebay collect taxes for that person, not only did he not have $100,000 worth of sales in Washington state to qualify for the nexus, he had no where near 200 sales, he had a total of 12 sales for like the 6 years he has been a member!

ebay should NOT BE COLLECTING SALES TAX FOR THESE PEOPLE!

IMHO ebay is keeping this money and implicating themselves in a massive tax fraud situation..

illegally charging long standing members taxes where they don't need to be collected!

I hope all member halt their buying until ebay sorts this out, its way out of control, i think they automatically charge taxes for every single item whether they are supposed to or not according to the state said item is being shipped to!

SHAME ON EBAY

we have enough scammers to deal with now we have this?

my buying is on hold until this get settled, i will go straight to the source from now on, and craigslist for used, where I wont be charged ridiculous taxes...

https://blog.taxjar.com/economic-nexus-laws/

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[eburtonlab]

@nineball26 

eBay is following the laws as passed by the individual states, collecting taxes on transactions delivered to those states, and turning the collected tax money over to the government of those states.

The transaction thresholds you cite are for remote sellers that do not use eBay, not marketplace sellers on eBay.

Laws have changed recently since the Supreme Court's 2018 South Dakota v. Wayfair decision.

See here:

https://www.ebay.com/help/buying/paying-items/paying-tax-ebay-purchases?id=4771

[nineball26]

ebay should NOT be collecting sales from international buyers.

for the SIMPLE fact these merchants do not have a US tax ID number, there is no one to pay the taxes to, there is no ID..

I fear ebay is in fora huge huge dilemma here, the IRS and and attorney general are probably waiting for them to get the noose good and deep before they say anything

ALSO, in order for ANY taxes to be collected said merchant must qualify as a tax nexus, and that qualification is $100,000 in sales the prior year, or 200 sales units..

many of these international sellers might sell maybe $10,000 in each state if they are HUGE, 51 x $100,000 + ..

that a lot of sales, I know one where they were going to charge me taxes form japan and this person had NEVER sold anything to my state, so even if they were supposed to collect tax from foreign sellers, which they are not, THAT'S WHY WE HAVE IMPORT FEES! but even if they were most do not qualify for the tax nexus so no taxes are to be collected..

these LAWS are designed to inure BIG BUSINESS pays their fair share, and ebay has taken the incentive to reverse this idea by charging the LITTLE GUY taxes they should not be paying!

shame on you EBAY!

more corporate greed!  

the exact intention of these tax laws, to curb corporate greed and insure they pay taxes in some form, instead ebay has decided to charge where they shouldn't be, from small buyers and sellers, therefore they hurt sales fro the small merchants or one off sales and discouraging buyers from buying..

go to a chat and ask for the laws fr international tax charges, they CANNOT SHOW THEM TO YOU!

because they do not exist, that's what import and duty is for!  they charge this as a means of collecting taxes from those who do not have US tax ID's!

this is ridiculous ebay and I for one will not be buying anything from ebay, i cannot in good spirit condone a deliberate tax scam...

because you want to charge me tax for a used item from japan?  huh?  on who's behalf are you going to file that money for?

this would require every single foreign merchant to get a tax number and business license, how can they do that?

then what about the tax nexus?

I guess it isn't enough every merchant must pay e-bay a percentage of their sale, then to paypal as well, now you have to gouge them for taxes?

again, show us the LAWS that says you must collect sales tax from a used item sold in Japan..

PLEASE

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[nineball26]

that's TOTAL BULL**bleep** AND YOU KNOW IT!

post up the language that states one must pay tax international items!

and whats the nexus for this? you're claiming that if someone has one single sale from china to the USA they must pay sales tax, import fees, and duty?

ebay is saying its possible that taxes be paid on a used item 4-5 times easily, and in one single sale a buyer can get nicked 3 times?

welp if they are trying to detour foreign sales then they are going to do it, but don't expect that to translate to more sales in the USA, because 99% of the time that item is NOT available in the USA, its WHY THEY BUY IT OVERSEAS **bleep**..

IMHO this is nothing more than a money grab by a greedy company that does not appreciate or has any loyalty to long standing members that built ebay.. good luck getting millennials on board to keep ebay afloat..

also, post that language up, that overseas tax collection law.. all I can find is STATES!

oh wait i found it, they must have an economic nexus!  the person I wanted to buy from DOES NOT HAVE THAT NEXUS!!! and ebay does not even check...

https://blog.taxjar.com/international-sellers-deal-sales-tax-u-s/

again this law was intended to insure BIG companies pay their share of taxes, instead ebay turns it on the little guy.. way to go ebay..

[eburtonlab]

@nineball26 

ebay should NOT be collecting sales from international buyers.

International buyers owe sales taxes if they have items shipped to a US location where such taxes have been enacted, or if they purchase items in US stores.

show us the LAWS that says you must collect sales tax from a used item sold in Japan.

Marketplace Facilitator Laws depend upon the location the item is shipped to, not the location of the buyer or seller. There are links to such laws to be found here, check to see if your state is one of them:

https://www.ebay.com/help/buying/paying-items/paying-tax-ebay-purchases?id=4771