Final value fee on sales tax

[azmiata_man]

I just found out this morning that sellers are charged a final value fee on sales tax collected. I am outraged over this! Just one more way ebay is hurting sellers!

[mybigsale]

@mam98031 

"And keep in mind that August 2nd PayPal is imposing a pretty large fee increase so those in MP will be saving even more if they consider what it would have cost them if they were still in PP."

PayPals fees are increasing from 2.9% to 3.4% - 1/2 a percent.  Lucky we are no longer with them and only have to pay eBays 12.55%.

I understand paying a transaction fee on the full transaction including taxes (not eBays full fee). I understand eBay charging a commission on the items I sell for using their platform.

Long ago eBay was outraged sellers manipulated the system by rolling their profits into shipping.

Long ago eBay manipulated the system to their advantage by charging commission on shipping and now they are also earning a commission on taxes. They deserve the commission on the item I am selling. The commission on shipping and taxes really has no merit.  It is comparable to the sellers who manipulated the system to not pay commission - only now it's eBay that is profiting.

Can sellers pass costs to buyers and still make a profit? Yes.

Problem solved.

PS: I believe other processors and sellers charge transaction fees in the 2-3 percent range on taxes.  Who else charges over 12%  fees on taxes?

[u_cant_take_it_with_u]

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@buyselljack2016 wrote:

Slight pricing adjustments have covered the difference for me.

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And that's all fine and well, but that's not the only bottom line nibbler sellers have had to deal with. On a selling venue that is already congested with cheap, [price conscious? 😉] skittish buyers; One can only raise their prices, to a compensating level, just so far. 

[mam98031]

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@mybigsale wrote:

@mam98031 

"And keep in mind that August 2nd PayPal is imposing a pretty large fee increase so those in MP will be saving even more if they consider what it would have cost them if they were still in PP."

PayPals fees are increasing from 2.9% to 3.4% - 1/2 a percent.  Lucky we are no longer with them and only have to pay eBays 12.55%.

I understand paying a transaction fee on the full transaction including taxes (not eBays full fee). I understand eBay charging a commission on the items I sell for using their platform.

Long ago eBay was outraged sellers manipulated the system by rolling their profits into shipping.

Long ago eBay manipulated the system to their advantage by charging commission on shipping and now they are also earning a commission on taxes. They deserve the commission on the item I am selling. The commission on shipping and taxes really has no merit.  It is comparable to the sellers who manipulated the system to not pay commission - only now it's eBay that is profiting.

Can sellers pass costs to buyers and still make a profit? Yes.

Problem solved.

PS: I believe other processors and sellers charge transaction fees in the 2-3 percent range on taxes.  Who else charges over 12%  fees on taxes?

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@mybigsale 

When you are paying 2.9% for a service and it changes to 3.49%, that is little more than a 20% increase in fees.

Don't overlook the increase in the per transaction fee.  That is going from 30 cents to 49 cents, a 19 cent increase or a little more than a 63% increase.  

10+ years ago Ebay started charging FVFs on shipping.  The reason really doesn't matter.  It is history now.  But again, standard in the industry for years before Ebay started charging the fee too.

As to FVFs on taxes, I've never been a fan of that and I was quite vocal against it back in August 2020 when they started this.  We are now almost a year later.  I still don't like this practice.  This practice is NOT the industry standard, you are absolutely right.

[hawkwind5454]

Re: FVF on taxes: At the very least, it just isn't *cricket*, And at the very worst, it's lacking of ethics.  I get the whole -there is no nickel too small, to not bend over and pick up- thing, but eBay just takes it too far. Or as some appropriately call it, GREED-bay. 

[glasser]

@reallynicestamps OK, but is you CC processor charging 12.5% or more like 2-3%? We are paying eBays FVF on the entire transaction not what the CC processor charges. 

[mam98031]

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@hawkwind5454 wrote:

Re: FVF on taxes: At the very least, it just isn't *cricket*, And at the very worst, it's lacking of ethics.  I get the whole -there is no nickel too small, to not bend over and pick up- thing, but eBay just takes it too far. Or as some appropriately call it, GREED-bay. 

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@hawkwind5454 

OK, I've never said I like it either.

I don't however agree with the use of the word "greed".

Ebay is a for profit company.  That is why they exist and continue to exist.  They aren't here for any other reason, other than to make money.  Sellers also are here to make a profit.  If a seller can find a way to make a better profit on something, it is likely a seller is going to do that because we too are here to make a profit.  So if making a profit is greed, then we are all greedy.

[mam98031]

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@glasser wrote:

@reallynicestamps OK, but is you CC processor charging 12.5% or more like 2-3%? We are paying eBays FVF on the entire transaction not what the CC processor charges. 

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@glasser 

I think we are getting a couple things confused.  Whatever a CCC charges for their processing fees is between Ebay / MP and that particular CCC.  There is very likely contracts with each CCC Ebay accepts payments from.  These fees are part of the money processing fees that MP charges to each of us in MP.  Ebay's FVF is on the sale of the item like it has always been, even though now in MP they are showing it as one fee.

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

[glasser]

@mam98031 

I am not surpised. eBay sold MP as being better for you with a lot or marketing speak and and claims of lower fees. Since this was mandatory assume most people didn't read. They had no choice.

They certainly weren't going to advertise in bold print: Another perk is we are now charging FVF on taxes we collect!!!

If they just chose honesty over hyperbole a lot of this would go away.

If they said, as we switch to Ayden, we are entering a more traditional CC processing environment. Many who have used only PP may have experienced the way CC are handled. CC processors view the total value charged to the CC as the basis for charging fees. They don't even know the difference between the basis of the charges--item, shipping, tax--this is standard practice at 99.9% of all sites using CC processors. 

Instead they made it sound like MP is new shiny product that eBay invented.  The whole thing is a misnamed. eBay is not managing your payments. Don't know who approved all that marketing speak and fluffy stuff. They dropped the ball. That's why people are complaining about eBay charging the fee when its really Ayden.

How hard is that?

[hawkwind5454]

You are preaching to the choir.  I was not contradicting any of that. I was only fortifying what you stated. And I don't care how much eBay Kool-Aid one drinks (don't read too much into that)...Most would agree, they do kind of guild the charge Lily, every chance they get. Some of the other sites follow suit, and some do not. Just because one disagrees with a practice, doesn't mean they don't understand the rationale and clockwork of it. 

[mam98031]

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@glasser wrote:

@mam98031 

I am not surpised. eBay sold MP as being better for you with a lot or marketing speak and and claims of lower fees. Since this was mandatory assume most people didn't read. They had no choice.

They certainly weren't going to advertise in bold print: Another perk is we are now charging FVF on taxes we collect!!!

If they just chose honesty over hyperbole a lot of this would go away.

If they said, as we switch to Ayden, we are entering a more traditional CC processing environment. Many who have used only PP may have experienced the way CC are handled. CC processors view the total value charged to the CC as the basis for charging fees. They don't even know the difference between the basis of the charges--item, shipping, tax--this is standard practice at 99.9% of all sites using CC processors. 

Instead they made it sound like MP is new shiny product that eBay invented.  The whole thing is a misnamed. eBay is not managing your payments. Don't know who approved all that marketing speak and fluffy stuff. They dropped the ball. That's why people are complaining about eBay charging the fee when its really Ayden.

How hard is that?

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@glasser 

I agree Ebay was far more optimistic about how much sellers would save than the reality of it.  And if the only thing you want to look at is transactions with sales tax you can't possibly get an accurate picture of the reality of how much of an increase or savings you will experience over the average month of selling on Ebay.

I have no idea why you are so concerned about how much any CCC is charging in fees.  It makes no sense to me.  MP charges a money processing fee just like PayPal always did.  We simply are NOT involved in what MP or PP pays to CCC for their fees.  That is between them and the CCCs.

All of this will change in regards to how much money you save being in MP or PP very soon.  And MP will be saving most sellers money.

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

[glasser]

@mam98031 

Technically you may be correct but that is not how eBay "sold" MP. All their charts read like this:

• 12.55% on total amount of the sale up to $7,500 calculated per item (plus.30)

So the obvious interpretation is 12.5%. They would have done themselves a favor if the had broken down fees as you suggest. Showing that they to incur a cost per transaction on your behalf with the CC processor. Better yet showing the fee basis in the transaction records in MP.

Also, don't forget eBay will become an equity a partner in Adyen when MP conversion is complete. I assume that given volume, overtime maybe eBay will pay less than 2.9%

[mam98031]

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@glasser wrote:

@mam98031 

Technically you may be correct but that is not how eBay "sold" MP. All their charts read like this:

• 12.55% on total amount of the sale up to $7,500 calculated per item (plus.30)

So the obvious interpretation is 12.5%. They would have done themselves a favor if the had broken down fees as you suggest. Showing that they to incur a cost per transaction on your behalf with the CC processor. Better yet showing the fee basis in the transaction records in MP.

Also, don't forget eBay will become an equity a partner in Adyen when MP conversion is complete. I assume that given volume, overtime maybe eBay will pay less than 2.9%

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Yes, 5% of Adyen will eventually be owned by Ebay.

[glasser]

@mam98031 

You said: I have no idea why you are so concerned about how much any CCC is charging in fees.  It makes no sense to me.  MP charges a money processing fee just like PayPal always did.  We simply are NOT involved in what MP or PP pays to CCC for their fees.  That is between them and the CCCs.

Ok, correct. I am concerned because eBay seems to have moved away from understanding their sellers.  Many people who sell on eBay have been doing so the same way for 20+ years.  Change is hard and eBay did a bad job educating people let alone the UX experience of not really explaining things like we need you SS# Bank info, etc. ( I have no problem with this but many people confused).

It feels more and more that eBay is just run by marketers and MBAs. Given all the data they have. They don't seem to have a feel for the seller experience or interest in many of micromarkets some of  us use. They put no energy into revitalizing many categories and let them languish with overpriced merchandise. They appear to be chasing--and I use that word deliberately because they are not leading--the next big thing. They see Amazon and Walmart as the competition instead o building out the uniqueness of eBay person-to-person selling. They have chosen to tinker instead of innovating. They seem more interested constant change or everything then investing the big bucks in what would make the biggest difference: attracting more buyers!

MP just a symbol of that.

[ulfesharpe]

The buyer didn't pay that amount to the seller, the seller never sees the tax.

So what are you really defending? That the seller pays a fee for an amount he hasn't earned.

How nice.

[mam98031]

@glasser 

I agree with you that Ebay did a very poor job communicating with sellers in regards to MP.  They have also done a horrible job having customer service readily available for sellers regarding MP.  

With that said as is evident on many threads.  There are a lot of buyers that never read a thing about MP.  Not because it wasn't available to them but because they just didn't take the time.  So some of it, certainly NOT all resides with some sellers that just don't even attempt to learn about the program.