Final value fees on sales tax????? Are you kidding?

[squarebiz99]

I don't know why I didn't notice before, but I looked at a breakdown of 1 of my transactions and saw that I am being charged a final value fee on sales tax. I don't collect sales tax. eBay collects it from the buyer. It's bad enough being charged a final value fee on shipping. Sellers should only be charged a processing fee for the shipping charge, not a commission, but this FVF for sales tax goes too far. Call it what you want, but a FVF is a commission. Someone should start a class action against eBay, but the biggest problem would be the legal costs. That's probably why no one has yet

[house*of*paws]

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@somanypostcards wrote:

I live in California.  Here's what the CA Franchise Tax Board says are the marketplace facilitator and marketplace seller requirements:

"Beginning October 1, 2019, a marketplace facilitator is considered the seller and retailer for each sale facilitated through its marketplace, for example, an Internet shopping website, to determine whether the marketplace facilitator is required to register with CDTFA for a seller's permit or Certificate of Registration.

If you are a marketplace seller, beginning October 1, 2019, you are no longer considered the retailer of your sales of tangible merchandise facilitated through a marketplace, as defined by statute, provided the marketplace facilitator is registered or required to be registered for a seller's permit or Certificate of Registration – Use Tax."

So in California it appears 2 transactions occur.  I, a marketplace seller, sell to eBay, the marketplace facilitator, with no taxes charged on my wholesale transaction as eBay is making a purchase that eBay plans to resell.  eBay sells to the buyer and charges a sales tax on the eBay retail transaction.  This being so, I should NOT be charged a FVF on the sales tax I did not collect in my wholesale transaction.

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@somanypostcards 

Did you happen to ask an attorney to interpret that verbiage for you?  

As I read it ... CA sellers are merely being told that it is no longer their responsibility to collect tax from buyers IF they are selling on a platform that collects the tax for them.   It says nothing about being charged fees ... OR what the fees should be based on.

eBay is the marketplace facilitator ... and NOT the seller.

[714ricki]

It's very legal! Try asking any business owner who has a credit card terminal. Their financial institute charges them a fee based on the entire purchase.....& that includes the sales tax. Please read up on the numerous threads here about the topic. 

[monroe67]

I also live in California.  (BTW, for non-Californios, the Franchise Tax Board is our state taxation department.  It does not apply only to business franchises.)    

While I thank you for quoting a CA Franchise Tax Board publication, I think your interpretation is incorrect.  

That quote you -- well -- quoted, says not one word nor one letter or number relating to whether eBay, as the marketplace facilitator, should or should not charge Final Value Fees (FVFs) on sales tax.  I wouldn't be surprised if eBay's legal department people would find your interpretation or inference or suggestion that we eBay sellers first "sell" our items to eBay -- to be humorous.  You are not considered a "wholesaler" just because you list an item for sale on eBay's platform. 

The South Dakota v. Wayfair Inc. decision by the US Supreme Court in June of 2018 created the concept of Marketplace Facilitators.  For purposes of sales taxes, Marketplace Facilitators are not the same as Retailers.  Rules for collection of sales taxes are different for Retailers and Marketplace Facilitators.   

OK, eBay does offer new users a chance to opt-out of the arbitration agreement.  

Does that pertain to FVFs on sales tax in any way?  

[somanypostcards]

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The CA Franchise Tax Board says are the marketplace facilitator and marketplace seller requirements:

"Beginning October 1, 2019, a marketplace facilitator is considered the seller and retailer for each sale facilitated through its marketplace, for example, an Internet shopping website, to determine whether the marketplace facilitator is required to register with CDTFA for a seller's permit or Certificate of Registration.

@somanypostcards 

Did you happen to ask an attorney to interpret that verbiage for you?  

As I read it ... CA sellers are merely being told that it is no longer their responsibility to collect tax from buyers IF they are selling on a platform that collects the tax for them.   It says nothing about being charged fees ... OR what the fees should be based on.

eBay is the marketplace facilitator ... and NOT the seller.

@house*of*paws

No, I did not consult a lawyer.  I merely read the instruction that says a marketplace facilitator in California is considered "the SELLER and RETAILER" by the state taxation department.  So you disagree with the CA Franchise Tax Board.

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[somanypostcards]

@monroe67 

The US Supreme Court date is 2018.  In 2019 the California Franchise Tax Board said:

"Beginning October 1, 2019, a marketplace facilitator is considered the seller and retailer for each sale facilitated through its marketplace, for example, an Internet shopping website, to determine whether the marketplace facilitator is required to register with CDTFA for a seller's permit or Certificate of Registration."

So in California where the marketplace facilitator is also the retailer the rules for collection of sales tax would be the same.

Because the OP mentioned class-action law suit and some participants stated this wasn't possible due to eBay's user agreement, I mentioned the opt-out option as it is tangentially part of this discussion.

[squarebiz99]

As I've said many times already, I get the 3% charge for processing, NOT a final value fee of 9-10% for God's sake

[squarebiz99]

As I've said many times already, I get the 3% charge for processing, NOT a final value fee of 9-10% for God's sake

[squarebiz99]

OK, why don't we all cave in once again to the almighty eBay's seller unfriendly policies. The list is long. I've been at this for 20 years and have seen it all

[squarebiz99]

I have been paying attention, as this thread that I started was to see how others view this issue and the results are 50/50. Half with the eBay huggers and half with the conscious business owners

[dbfolks166mt]

OK, why don't we all cave in once again to the almighty eBay's seller unfriendly policies. The list is long. I've been at this for 20 years and have seen it all

     One is always free to advocate for change. Trust me I am not an eBay cheerleader and I have been at this a long time also. I don't like or agree with many of their policies and/or processes, especially the lack of seller protection, but some things it is just easier to adjust or adapt to than it is to try and change. 

     There are a LOT of things in life that I don't like or agree with, most of them at the Federal and State governmental level, but I don't have the time or energy to fight against. I just finished doing my income taxes which I have hated doing since the day I started working but getting that changed is not a a battle I am willing to engage in. 

[dbfolks166mt]

I have been paying attention, as this thread that I started was to see how others view this issue and the results are 50/50. Half with the eBay huggers and half with the conscious business owners

You could probably split the eBay huggers into two groups. Those that have simply adapted and adjusted and those that think eBay can do no wrong which of course we know is not always accurate. 

[house*of*paws]

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@somanypostcards wrote:

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The CA Franchise Tax Board says are the marketplace facilitator and marketplace seller requirements:

"Beginning October 1, 2019, a marketplace facilitator is considered the seller and retailer for each sale facilitated through its marketplace, for example, an Internet shopping website, to determine whether the marketplace facilitator is required to register with CDTFA for a seller's permit or Certificate of Registration.

@somanypostcards 

Did you happen to ask an attorney to interpret that verbiage for you?  

As I read it ... CA sellers are merely being told that it is no longer their responsibility to collect tax from buyers IF they are selling on a platform that collects the tax for them.   It says nothing about being charged fees ... OR what the fees should be based on.

eBay is the marketplace facilitator ... and NOT the seller.

@house*of*paws

No, I did not consult a lawyer.  I merely read the instruction that says a marketplace facilitator in California is considered "the SELLER and RETAILER" by the state taxation department.  So you disagree with the CA Franchise Tax Board.

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@somanypostcards 
Hardly ... I file taxes to the CA Franchise Tax Board yearly.

I disagree with your interpretation of what the Board says.

[donsdetour]

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@squarebiz99 wrote:

I have been paying attention, as this thread that I started was to see how others view this issue and the results are 50/50. Half with the eBay huggers and half with the conscious business owners

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When I see such I look and see how long the user has been on ebay. Fact is that Paypal charged a fee for all the transaction amount including tax if any on a purchase through them. Did not see users on ebay or else were gripping about it.

Usually such topics show me that a person had no idea what they were paying in fees on ebay or else were.

That use to shock me, but now it is just what it is. Manged payments has taught the ignorant what the cost are and have been.

[islanddreamin]

Well, Class action lawsuits are handled all the time for "no fee" by attorneys.... The problem is A) we all accepted an agreement based on eBays rules to do business on THEIR site. B) To accept a lawsuit on a no fee basis most of those attorneys want a high percentage of the settlement they achieve, and they do not want to take it to court (in fact they are encouraged by the court not to) the go to is to settle out of  court ASAP they less time they spend the less they have in costs. To do this they settle for a lesser amount then what is filed and to encourage the business they are going after they recommend a hard money/soft money settlement.Hard money is a cash payment which is paid to that law firm that is suing the company the soft money is what is usually paid to someone like us an example of that would be us "wronged sellers" would receive something like no listing fees for a year or something that only occurs as something is sold...there would not be a significant settlement to each seller. Further eBay is a business if they have new operating costs due to a lawsuit etc. DO YOU REALLY THINK THEY WILL JUST EAT THOSE COSTS? Nope they will have a new costing schedule for us! So as aggravating as it may seem (I grind my teeth as well especially if I pay them a promotional fee that is doubled fee'd as well) Its still cheaper than building your own website and taking care of all the transactional costs yourself.......Class Action suits help the attorneys not the recipient's IMHO!

[chapeau-noir]

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@squarebiz99 wrote:

I have been paying attention, as this thread that I started was to see how others view this issue and the results are 50/50. Half with the eBay huggers and half with the conscious business owners

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I would think that "conscious business owners" (taking a shot at what that is actually trying to say) would pretty much accept the conditions of conducting a business on this platform.  Is that the same as "eBay huggers"?