EBAY OVERCHARGES FEES ON SALES TAX

[yenmai88]

Hello,

I have sold one item:

selling price: $19.98

Shipping charge: $12.98

Subtotal: $209.96

+ Sales taxes on buyer: $18.5

= Grand Total $228.46

I dont know why EBAY takes away $28.97 fee???

It should be only 12.55% on $196.98 selling price + $0.30 fixed order fee = $25.02

However, Ebay takes 12.55% on grand total $228.46 + $0.30 fixed order fee = $28.97???

Why do Ebay takes fee 12.55% on even $18.5 sales taxes that they buyer pay?

Why do I have to pay extra 12.55% on $18.5 sales taxes = $2.32 on the sales taxes?

This is so unreasonable and illegal that Ebay takes fees on the sales taxes of the transaction. This is overcharge to the sellers. I'm feeling very angry on this fee that Ebay takes from my transaction. 

[mam98031]

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@realrealgames wrote:

You think charging a sell fee of 12.55% on taxes is right? It may even be illegal...

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@realrealgames 

Is it only illegal because Ebay does it or was it also illegal all the years that PayPal did it?

[mam98031]

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@realrealgames wrote:

You must work for eBay. 😀

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@realrealgames 

Why is that?  Do you think sellers can't learn what the policies of the site?  I've been an active seller for a whole lot of years.  I stay as current as I can on the rules and policies of Ebay.  Nothing I said was inaccurate or untrue in any way.  So if you take exception to something I've said, please be specific.

[realrealgames]

eBay started charging tax for me around two years ago, PayPal hasn't been doing it "all the years".

[realrealgames]

When you have to pay a 12.55% FVF on the tax of an $500 sale, it adds up.

[mam98031]

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@realrealgames wrote:

eBay started charging tax for me around two years ago, PayPal hasn't been doing it "all the years".

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@realrealgames 

Oh you are talking about on the site.  That is a different issue all together than the one we have been discussing here.  The fact that states started passing MFLs in 2018/2019 requiring marketplaces to charge sales tax for their states doesn't apply to this discussion.

Your conversation and that with others has been the FVFs charged on sales tax in MP.  Different subject all together.   Sales tax when charged to a buyer by Ebay in the last couple of years or by the Seller before that for the state in which they reside in, Paypal ALWAYS charged their fees on the total amount receive regardless of what the payment was for.  

So if this is a problem for you with Ebay, it should have been a problem for you when you used Paypal.  You can't have it just as a problem with Ebay as that makes no sense.

[mam98031]

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@realrealgames wrote:

When you have to pay a 12.55% FVF on the tax of an $500 sale, it adds up.

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Yep it sure does.  And when you have a sale for $500 that doesn't have sales tax on it, you sure save on your fees.  It is a two way street.  You can stay stuck on a few transactions that you pay more on if you want.  It will not however get you to the truth of the matter.  But then that is your choice.  

[barbsfinn]

This whole eBay payments program is a complete rip off and the worst program every implemented by eBay. Where did the 30 cent charge come from and then to charge us fees on sales tax and shipping cost is just not right. We were told initially that we as sellers would be paying less when payments started, this is not the case. On top of that we have to wait days to receive our funds while they sit on millions of dollars every day. 
EBay have always been geared more to buyers than sellers, wake up eBay with out us sellers you have no business. There is so many more platforms on the internet now to sell our items and I have been transitioning to these with less fees and more consideration for the sellers. 

[barbsfinn]

I agree but PayPal didn’t charge more than 12%. 

[mam98031]

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@barbsfinn wrote:

This whole eBay payments program is a complete rip off and the worst program every implemented by eBay. Where did the 30 cent charge come from and then to charge us fees on sales tax and shipping cost is just not right. We were told initially that we as sellers would be paying less when payments started, this is not the case. On top of that we have to wait days to receive our funds while they sit on millions of dollars every day. 
EBay have always been geared more to buyers than sellers, wake up eBay with out us sellers you have no business. There is so many more platforms on the internet now to sell our items and I have been transitioning to these with less fees and more consideration for the sellers. 

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@barbsfinn 

It is amazing how many sellers were unaware that Paypal ALWAYS had a per transaction fee.  But they only noticed it when MP charged it.  😕

The fees in MP have NOT increased overall fees. The following numbers represent those that do not have a store and the fee rate for most common categories [not all].

Fees BEFORE going into MP
10.20% FVF + 2.9% PP fees = 13.10% plus 30 cent per transaction fee.

In MP the fees are:
10.20% FVF + 2.35% money processing fee paid to MP = 12.55% plus a 30 cent per transaction fee.

Starting August 2nd, PayPal is raising their fees, so they will be as follows:
10.20 Ebay FVF + 3.49 PP Fee = 13.69% plus .49 cent Per Transaction fee

PP is apparently offering different fees to different sellers, likely depending on size. From what I've seen it is between 2.59% and 3.49%.

[mam98031]

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@barbsfinn wrote:

I agree but PayPal didn’t charge more than 12%. 

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I agree, there aren't many that like it to be sure.  But if you look at your fees on a monthly basis, you won't find much of a change before you went into MP and after.  And that is because on some sales their fees are LESS.  So it ends up being a neutral change for most sellers.

[soh.maryl]

Sorry -- I am still back at wondering how selling price of $19.98 plus shipping of $12.98 adds up to a subtotal of $209.96.  

[soh.maryl]

The fact that the OP resides in a state that has no state sales tax has no bearing on this situation.

The OP was asking as a SELLER.  The SELLER does not pay the state sales tax, the BUYER does.

The BUYER pays the state sales tax, if any, based on the BUYER'S delivery address.  He pays it when he pays for shipping and item price.

eBay (not the seller) then remits those funds to the treasurer of the affected state.  The affected state is the state to which the BUYER'S purchase is delivered.  

[soh.maryl]

OK, but it doesn't really matter what you think eBay should take.  Their site their rules.

Plus it costs some money for eBay to process remitting all those various sales tax funds to the appropriate state.  Is that a job you'd like to take on yourself? Keep in mind that, within a single state, there can be more than one tax rate, county or city in addition to the state sales tax.  

[barbsfinn]

I was always aware that PayPal charged me a fee but they didn’t charge me 12.55% fees on shipping cost and sales tax. I get no benefit from either one of these amounts but eBay charges me 12.55%. On a large item my shipping cost can be $18 to $20 and 12.55% is a hefty charge. I only charge 50 cents to $1 for handling fees depending what the shipping supplies are. I get why eBay started charging fees on shipping cost as unethical sellers were charging 99cents for an item and $30 for shipping.  Their practices hurt us ethical sellers and we were penalizes. if I raise my shipping cost to cover these charges buyers say my shipping is high, if I include free shipping buyers say my price is too high. We are between a rock and a hard place.
Also eBay encourages us to offer free returns on our items and free shipping. I sell an items for $50 with free shipping, shipping cost me $12 , the item is now $38 buyer decides she doesn’t like it, no fault of mine and I have to pay $10 return shipping. I am now down to $28 for my item and have to start all over again, I have already lost money. 
As far as the sales tax, eBay got away with not charging that for years until that all caught up with them and law suits were filed in the UK and Europe. I am not complaining about anything but the fees on shipping costs and sales tax, I feel it is very bad practice and discourages sellers to list on this website.

Another fee that just popped up is a 1.65% international fee, where did that come from all of a sudden? 
As I said before eBay always favors buyers rather than sellers but so many of us are transitioning to other platforms, they must be noticing the difference in sales.  I used to be a power seller and have been selling on eBay for more than 20 years but have now reduced my listings to a very low number.

[stephken100]

So you gonna sit there and tell me the eBay doesn’t invest  our money in 24 hour returnable dividends while it’s waiting to be processed and put it in our banking accounts also? If you do, I will call you a liar