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Internet sales tax

On Jan 1st eBay started automatically charging sales tax on items sent to Washington a Minnesota. They are collecting the tax and turning it over to the states themselves. As a seller, you really don't know this is happening. As a buyer in either of these states, you now see that you are being charged. First, eBay seems to have jumped into the pool with their clothes on instead of a swimsuit. Most states laws have said taxes need to be paid after the first $100,000 or 200 transactions. I am pretty sure no one on eBay had done $100,000 or 200 transactions to either state on the first day of the year. Therefore I am paying taxes which I am not obligated to pay. Moreover and more importantly for me, I am a business, have a valid business license and am not required to pay tax on anything I purchase for resale. I can walk into any state store and buy without tax as a business. Yet eBay is now forcing me to pay tax on the 99% of items that I purchase on the platform for resale, which seems illegal to me. You can not opt out. I am now at a 10% disadvantage with my competition who may not purchase on eBay, or at the very least I become less competitive because I have to raise prices. EBAY!! Stop forcing me to pay an illegal tax. Also curious that after calling and speaking with two concierge members, they had no idea this was being done. One tried to tell me that eBay was NOT collecting taxes yet an Oct notice states they would. How well has this been thought out if their own people, who answer questions, have never been told about it?  

Message 1 of 81
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Re: Internet sales tax

Your absolutely right buyer beware I found this out today.
Message 76 of 81
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Re: Internet sales tax

Yep. Bought something the other night out of my state and was nailed with tax. 

Message 77 of 81
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Re: Internet sales tax

I live in Canada and just bought a bicycle worth $1400. from a Seller in the US. I use a company near the border to bring up items then clear them via customs myself and will pay BIG Canadian tax on the bike (this is super common and totally legal). So I have a Washington state address...

 

As I used a "Make an Offer" option to buy the bike which was accepted I had NO idea there would be nearly $140 usd taxes on the bike! So basically I'm getting dinged taxes twice and I don't even live in Washington 😞

 

This seems really unfair... I assume there is nothing I can do to prove my citizenship and avoid the tax?

Message 78 of 81
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Re: Internet sales tax


@linzter wrote:

I live in Canada and just bought a bicycle worth $1400. from a Seller in the US. I use a company near the border to bring up items then clear them via customs myself and will pay BIG Canadian tax on the bike (this is super common and totally legal). So I have a Washington state address...

 

As I used a "Make an Offer" option to buy the bike which was accepted I had NO idea there would be nearly $140 usd taxes on the bike! So basically I'm getting dinged taxes twice and I don't even live in Washington 😞

 

This seems really unfair... I assume there is nothing I can do to prove my citizenship and avoid the tax?


Citizenship is NOT the issue, sales tax is applied based on the location it is shipped to. It may be possible to apply to Washington State for a refund but for sure you would need documentation proving that you re-exported the bike from Washington to Canada.

 

Here is a link to the Washington State Revenue department, looks like they are developing a process for non-residents but it's not fully in place yet. You could call or email them for the latest info and to see if you might qualify.

 

https://dor.wa.gov/find-taxes-rates/retail-sales-tax/sales-nonresidents/refund-information

 

 

Message 79 of 81
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Re: Internet sales tax

You do realize of course that Most states laws have said taxes need to be paid after the first $100,000 or 200 transactions actually applies to income tax and not sales tax, right?

Message 80 of 81
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Re: Internet sales tax

There is NO limit below which income tax is not due. The poster is actually talking about interstate sales tax thresholds.

In most States you will get a 1099 from the payment processor when you hit at least 200 transactions and $20k in sales. In MA and VT the dollar limit is $600. However that is not the threshold for paying taxes. Income Taxes are due based on profit whether you get a 1099 or not.

 

The poster WAS talking about collecting sales tax on cross border sales. Since most States are implementing Marketplace Facilitator laws, the collection threshold is based on total EBay sales not the individual seller.

Message 81 of 81
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