mam98031 • Volunteer Community Member • Buyer/Seller since 1999
Let's keep this in mind, because some want to make this out to be really expensive for sellers when it is not.
$100 sale with $10 in sales tax. FVF of 12.55% = 13.81
Same sale if PP processed it would be as follows
110.00 X 2.9% = 3.19
100.00 X 10.20% Ebay FVF = 10.20
Total Fees 13.49
So on a $100 sale MP is 32 cents more expensive.
Same transaction with no sales tax.
$100.00 x 12.55 = 12.55
Which is $1.26 LOWER than if it had 10% sales tax on the sale.
So as I was saying it is NOT a one to one ratio. $1.26 divided by 32 cents = about 4. But all of this depends on the rate of sales tax charged. And that varies by state. In post 27 I provided a pic that has the various different sales tax rates across the nation.
@bluestardiecast wrote:
@mam98031 wrote:
You don't believe me, that is absolutely fine. Do your own analysist and compare a few months worth of sales in MP and then before MP. See for yourself. Or easier yet. Look at your monthly fees [less any store fees and promotion fees] and compare it.
It's not a matter of believing what you are saying and yes, there could be some minute savings when a sale originates in a state that doesn't collect e-commerce Sales Tax. But since we have been breaking down our charges EVERY month since 1998, I know where the fees originate and how they are figured. We have even had some charges refunded when not correct based on the receipts. We do compare month to month and take the store fees and promotional fees discount percentage into account. But our examples were based on your numbers which were about average for FVF fees across all categories.
If you are fortunate to have a majority of sales coming from non tax states, then I would agree with some of your assessment that the fees may work out a bit closer for each process method eBay MP vs eBay / PayPal. Since there may be 0 states at the end of next year, your model doesn't hold long term. When I gave the less than 20% of our sales came from non collecting states, this also included countries not imposing VAT yet like Canada. If those sales were excluded then we are under 10% of non tax collecting sales to USA. (We are fortunate right now that Oregon is still not collecting as a lot of items go to International freight forwarding places there.) This is why OUR fees are higher (fact) along with many other Sellers (possibly), but we have adjusted for this increase. Yes, it may cost us some sales for not being the lowest priced items, but if we can't make money selling here, then we should close shop and find something else to pursue.
I appreciate your time & knowledge here and hope you understand this is just a fact based discussion describing our actual results.
That is an interesting way to describe it. You stated "...there could be some minute savings when a sale originates in a state that doesn't collect e-commerce Sales Tax." If it is your opinion that what you save in fees on a sale that has no sales tax is "minute" then you must also say that the FVF we pay on sales tax is even LESS than that, maybe micro. IDK, but it is much less.
Taking Store Fees and promotional fees into account when comparing FVFs will not give you accurate information. FVFs have nothing to do with store fees or promotional fees which is why you need to deduct those.
"If you are fortunate to have a majority of sales coming from non tax states, then I would agree with some of your assessment that the fees may work out a bit closer..." I'd say you clearly did not understand what I wrote because no one needs a "majority" of their sales to be non taxable. But it is clear to me that you mind is set, so no matter what I say it won't matter.
@releasethekraken_1 wrote:
@mam98031 wrote:Let's keep this in mind, because some want to make this out to be really expensive for sellers when it is not.
$100 sale with $10 in sales tax. FVF of 12.55% = 13.81
Same sale if PP processed it would be as follows
110.00 X 2.9% = 3.19
100.00 X 10.20% Ebay FVF = 10.20
Total Fees 13.49
So on a $100 sale MP is 32 cents more expensive.
Same transaction with no sales tax.
$100.00 x 12.55 = 12.55
Which is $1.26 LOWER than if it had 10% sales tax on the sale.
So as I was saying it is NOT a one to one ratio. $1.26 divided by 32 cents = about 4. But all of this depends on the rate of sales tax charged. And that varies by state. In post 27 I provided a pic that has the various different sales tax rates across the nation.
PayPal is now charging 3.49%, so their fee would be $3.84, for a total of $14.04.
They also charge the 30 cent fixed fee, but since you left that out of both calculations, that's a wash.
Not all sellers will pay 3.49% in PP. It depends on the offer PP extends to you. It ranges from 2.69 to 3.49%, I think that was the range.
And yes, you are correct about the 30 cents, however it also wouldn't be appropriate for what I was previously writing about since this fee is NOT a FVF, it is a per transaction fee. As you know it is the same for a $1 sale and the same on a $1000 sale. It is just the fee for the transaction, not a percentage of anything.
@house*of*paws wrote:
@2012ontheside wrote:I don't think that sellers should pay a fee charge on sales tax or shipping. I just spoke with a rep and they agree, this is a problem they have raised with their upper management.
I'm afraid you didn't speak with a knowledgeable rep.
Basing fees on the totel amount the buyer pays ... including shipping & tax ... is what ALL payment processors do. This is not 'a problem' that eBay will change ... as it is what is normal for the field.
Previously, you paid fees to PayPal on shipping and tax. You paid fees to eBay only on shipping. Now you only pay fees to one agent ... and ALL are based on item price + shipping + tax. That is allegedly why eBay claims to have reduced the overall percentage of fees. The vast majority of sellers who have actually calculated and compared fees under PP and MP say they haven't seen a change ... or it's very slightly higher now. [That's based on posts in the 'Ask a Mentor' Board, where this subject comes up a lot.]
You are losing something in your explanation. The PP fee was 2.9% on the entire amount they processed. The Fees that Ebay charged as FVFs back when PP was are processor did NOT include sales tax.
That is what most are objecting to. Ebay did NOT charge their FVF on sales tax before MP. Another thing to consider is that NONE of the other larger sites similar to Ebay charge their fees on the sales tax portion of the sale. Ebay is the only site that I'm aware of that does this.
@pandorasartbox wrote:That is what I take exception to. I don't see why the sales tax is part of the total percentage taken out of my payment if I never see that money at all. Now I could understand a nominal flat rate "processing fee" for collecting and distributing said sales tax. That would be fair. I haven't been able to find a decent explanation of WHY sales tax is included in the FVF other than "because we said so" LOL.
It is handled in MP just as it was in PP. It does get processed with the payment but then is immediately removed and sent off to Ebay for remittance to the appropriate state. You can see the amount on your Order details and in your Detail transaction reports in MP.
@house*of*paws wrote:Hi @mam98031
Reread my post. I said eBay charged fees only on shipping previously.
You are right. I did misread your post, my apologies.
FYI, I sell on Etsy and Amazon too. Neither of those sites charge ANY fees, money processing or otherwise on sales tax. I don't know about other sites, just the ones I sell on.
@house*of*paws wrote:
@mam98031 wrote:FYI, I sell on Etsy and Amazon too. Neither of those sites charge ANY fees, money processing or otherwise on sales tax. I don't know about other sites, just the ones I sell on.
Now I'm confused. LOL
I thought eBay and Etsy employ the same payment processor ~ Adyen. Are you saying Adyen charges eBay sellers fees on tax ... but not Etsy sellers?
No need to be confused. Adyen on either Ebay or Etsy does NOT have any control over what the Ebay or Esty charge as a FVF. Why would you think that they do as the money processor. PayPal never had that power either. Now you have me confused as to why you would think Adyen had anything to do with it.
