Ebay profiting on tax collection

[gsxrida1980]

Frequent topic, yet to date it has no resolution.

Ebay profits by collecting from sellers a percentage on the taxes it collects on each transaction. 

Defenders say it costs this amount for Ebay to remit taxes to the various states. For example, a $1k item with $100 in taxes costs Ebay $15 (15٪) to account for and remit those taxes? Doubtful.  Further, there are economies of scale that being this cost way down when submitting taxes linked to many transactions to a single state.

In the end, discovery via class action

litigation will show that Ebay is profiting off the taxes it collects. Worse yet, the profits increase with the the size of the transaction. Ebay's effort to collect and remit taxes does not increase with the size of the transaction. 

Lastly, this form of fraud discourages transactions by punishing sellers of higher priced items that are charged higher fees on taxes collected. The Internal Revenue Service can be expected to take issue with this. 

My group may even assert discriminatory claims on this basis in our federal court Complaint. If you are an Ebay seller, I encourage you to join our class action filing.

[gsxrida1980]

Your response is a bit too unsophisticated to warrant a reaponse. Sorry.

[gsxrida1980]

So true. Until it costs them.

[gsxrida1980]

When you charge profit on, and under the guise of, tax collections, things can get hairy.

[gsxrida1980]

Incorrect. I pay higher fees on higher assessed taxes on more costly items. C'mon, it's simple arithmetic. 

[kensgiftshop]

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@gsxrida1980 wrote:

Incorrect. I pay higher fees on higher assessed taxes on more costly items. C'mon, it's simple arithmetic. 

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You pay the same % as the rest of us.

[gsxrida1980]

Not apples and oranges. You misunderstood the intricacies involved.

[gsxrida1980]

How much work does ebay really do? It's a stupid ad website. Their costs are primarily fixed.

[gsxrida1980]

But they don't charge you profit on top of the taxes collected.  Can you not see that?

[gsxrida1980]

Re IRS, it wants tax dollars, right? Does it want its tax inflows to be limited or diacouraged because of fees being charged on top of tax revenues? 

Put another way, if ebay scares sellers away by lopping fees on top of taxes collected, ebay discourages transactions, thus lowering tax revenues....ALL BECAUSE EBAY WANTS TO MAKE PROFITS ON TAXES COLLECTED. 

[gsxrida1980]

That doesn't make it legal.

Ebay having settled this exact claim, in at least one instance for 7 figures, is an admission of liability. 

Bottom line: ebay is gouging sellers under the guise of tax collections, have been sued over it, knew they were in the wrong, and settled the suits knowing they would lose in court. That's enough motivation for me.

[gsxrida1980]

Why not? Ebay has a monopoly. Nowhere else to go.

[glorybells]

Go back and read the eBay User Agreement.  Find the part about eBay members agreeing to not file a lawsuit against eBay, and agreeing that any disputes would be resolved through arbitration.

I’ll wait.

[gsxrida1980]

You underestimate the ability of off the shelf bookkeeping software. Ebay doesn't have hundrrds of workers maintaining spreadsheets with individual transactions. Don't be so naive.

Do just a little bit of math and you'll see ebay's inflows for "tax collection" fees far exceed this administrative cost.

[inhawaii]

@gsxrida1980 

You remind me of every other seller who comes here once a week to announce they are suing ebay.

Good luck!

[kensgiftshop]

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@gsxrida1980 wrote:

That doesn't make it legal.

Ebay having settled this exact claim, in at least one instance for 7 figures, is an admission of liability. 

Bottom line: ebay is gouging sellers under the guise of tax collections, have been sued over it, knew they were in the wrong, and settled the suits knowing they would lose in court. That's enough motivation for me.

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When was that lawsuit?