Fees on Sales tax

[yveandall]

When did Ebay start charging fees/commission on sales tax?  Do we have any input on this? It's rather greedy.

[dbfolks166mt]

We know that eBay was charging a low processing fee that covered the cost of Tax Processing when they first started Managed Payments. We know that every other vendor can process taxes using a similar low processing fee.

     You don't "know" that  unless you work in eBay's accounting department or one of the other ecommerce sites accounting departments. If not you are making assumptions without factual data to back that up. Maybe the other companies took the cost out of hide and simply wrote it off on their taxes. 

We know eBay changed their fee by adding commission on top of that transaction fee - not to handle the cost but to make it "easy for sellers to understand" and added significant profit on tax processing in the way of a commission on tax charged to sellers (through the new combined Final Value Fee).

Other than the simplicity from both the sellers perspective and eBay's processing the added profits are still assumptions. 

We know in June eBay added State Tax and Shipping to calculations on Ad Fees that further increased the take from sellers on Tax.

There is no question about that one and for those that choose to use PL they are aware of that. PL was 100% designed to increase eBay's profits without question. 

I see sellers saying eBay needs to charge the 12.9% (plus more % in ad revenue on State Tax) to process taxes instead of 1-3% like every other vendor/processor.  I have never seen eBay state the extra "Commission" is nothing more than a byproduct of extra money they receive as a result of "Simplifying fees for sellers". I have seen increases in State Tax and Shipping result in a revenue increase for eBay (eBay not just covering processing costs).

If you can find that information in their financial disclosure statements please provide the link and the data to substantiate that. 

eBay is not going to change FVF. Many vocal sellers seem to prefer having the one combined fee (even if it means paying an EXTRA 8-9% on transaction fees). 

The percentage is actually about 1% additional depending on the individual state sales tax rate or about $1.00 for a $100 sale to a state with 7% sales tax.

$100 * 7% = $7

$7 * 1.29% = $.90

If you are using PL you will have to do your own math based on your PL settings. 

[mybigsale]

eBay Cost of Tax Processing = (eBay Cost of Tax Processing + Commission on Tax) + (Seller Ad Rate X State Tax Paid)

I am glad we have eBay to simplify this for us. Sellers would be lost without eBay to simplify math without benefit to themselves. Maybe eBay should add "Buy eBay a Coffee" button to item pages so sellers and buyers can help support this charitable work.

Never mind - let's just all set our Ad Rates to 100%.  I don't understand the simplified math.  Does eBay make any profit when they collect 112.9% of a sale? 🙄

[paraphernalia_palace]

I already am and have been over 10 years now.

[dbfolks166mt]

eBay Cost of Tax Processing = (eBay Cost of Tax Processing + Commission on Tax) + (Seller Ad Rate X State Tax Paid) WHAT???

I am glad we have eBay to simplify this for us. Sellers would be lost without eBay to simplify math without benefit to themselves. Maybe eBay should add "Buy eBay a Coffee" button to item pages so sellers and buyers can help support this charitable work.  Given the above example you should be glad eBay is doing this for you. 

Never mind - let's just all set our Ad Rates to 100%.  I don't understand the simplified math.  Does eBay make any profit when they collect 112.9% of a sale?  Difficult to say. You would need to work in eBay accounting to know this. One this for sure is the seller is not making any money but hey they are the ones that chose the PL rate. 

[mybigsale]

Sorry you didn't see the satire in my last post. Thanks for providing your opinions. 🙄

[ibuyoldstuf]

I used to be in complete agreement with the OP on this topic until I looked into it further and discovered that as long as I don't have to keep up with all the filing, maintaining documents, gathering 501(c) (3) info and on and on they can have the percentage!!!

I have many issues with eBay's Nickle and Diming us to death but this one,,

I'm all in!

[ibuyoldstuf]

Look at my vary first post when I came back as a seller last year!  I feel Ya!

But I get it!

[ibuyoldstuf]

I Do Both!

49 a share up from 46  still down from 63... and I complain on both ends!

It's not how much you make!🤔

It's how much ya keep!😉

Be Cool In School!

[hriczgashenr]

When no one was looking they figured they would slip it under the noses of the sellers.

And they charge more than anyone in the retail business, fees on shipping too, greedy isn't it?

[hriczgashenr]

12.9% of 100 =$12.90

where on EARTH do you come up with 1%

[ibuyoldstuf]

I bought some pottery from a site called charish where I was charged a "Logistics Fee"! 15.00 on one piece and 4.00 on the other!   I contacted support and asked what a "logistics fee" was!  I was informed that it's the portion / percentage buyers had to pay to offset the cost of sellers and the site ! 

So when shopping there now we have to add a logistics fee into the equation?  

I'm good here for now.. 

[joliztoyco]

And again....I REPEAT...they are NOT CHARGING FEES TO PROCESS YOUR SALES TAX. Why do you people keep repeating this fiction?? Credit Cards are charging a "fee" for the money you are "borrowing" against their card.
Period. 
OG pays "fees" to use the services of the credit card companies. The credit card companies sure as heck don't add extra fees for "processing taxes". But nice try.....
And considering that Darden has over 1800 restaurants in every major, minor and even small city across America, I'm pretty sure they're well aware of the tax rates of myriad "municipalities". And process hundreds of MILLIONS of cash transactions a year. Do they charge us a "tax handling fee" when we pay with cash?
Do you see where I'm going with this?
I pay Ebay a fee of 12.9% on my auction+shipping transaction.
Darden pays a 2.9% fee for each transaction using a credit card. The credit card company makes money off the transaction, and the cost of splitting out the taxes is baked into their model.
Not Ebay. After taking their 12.9% fee for my "auction" transaction they then charge us another 12.9% on the sales tax. Because they failed to bake THAT into their model. They RAISED their FVF when taxes started being charged to online sales. Because they thought they were a credit card company? I'd have less problem if Ebay was taking their 12.9% cut of my auctions and a tax handling "fee"of 2.9%. But they aren't. They're gouging us at 12.9%. Which means a cool 600+ MILLION a year into their profit margin. Can you imagine how happy  credit card companies would be if they could charge a 12.9% fee on the taxes they collect???
I hear lame statements like "Well...they only "raised the FVF an additional 2.9% when they started collecting taxes. And I laugh. Because now, not only were they getting 12.9% of your auctions...they were also collecting 12.9% off the tax money. Why didn't the keep the FVF's the same on auctions and just add a 2.9% fee on taxes???
Because doing it the way they did, and sellers not understanding what they were doing, made them MILLIONS MORE in profit.
And you sellers fell for it. 
I sell something for 100.00 under the old rates. Let's say the old FVF was 10%. 
So Ebay gets 10.00 And taxes are 8.00. So 2.9% of 8 bucks is .23 Seller pays Ebay 10.23 for the transaction.
But jacking ALL of it up to 12.9%?? 13.93!!! Sweet profit!
Why didn't they just leave the old rates the same and just apply the same 10% rate to the taxes??
10% of 108.00=10.80 
Because they saw an opportunity to raise their FVF's under the guise of "taxes". They were "helping" you. (LOL)
And sellers fell for it.


 

[joliztoyco]

I have zero problem with your statement. Because OG has baked this into their cost. Whether you pay by credit card or cash...the price of your meal is the same.

[joliztoyco]

So every time a state or municipality RAISES taxes, Ebay takes more of our money??
Why didn't they just leave the old FVF's the same and add a 2.9% fee to handle taxes?
Oh that's right! Because a 100.00 sale with 8% taxes would have been 100.00 (10%FVF)=10.00
And 2.9% of 8.00 would have been .23...Total  So Ebay made 10.23.
Instead they just made it 12.9% on the whole thing...13.93! That's a pretty sweet profit margin.
I can only imagine your faces if the Feds pass their proposed "National Sales Tax".
The numbers could be as high as 10%. 
I can see buyers checking out and they see not only 8% in state sales tax, but another 10% on top of that?? 
A $100 sale and they're paying 18.00 on taxes on it??? 
Yeah...that back button will be getting used a lot.
But Ebay will love it!!!
Your sales? Not so much.....

[inhawaii]

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@yveandall wrote:

When did Ebay start charging fees/commission on sales tax?  Do we have any input on this? It's rather greedy.

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Years ago.

Yes, you may give ebay as much input as you like.