Sales tax . . . the problem has begun

[k-mansparts]

SCOTUS  has ruled 

the problems will be enormous 

[dr.clockenstien]

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@1ezdeal wrote:

That is wrong, the law in PA is that if the market place has a presence in PA they have to collect taxes from their third party sellers, since amazon has werahouses in PA they have to collect the taxes but ebay does not have any typen of presence in PA so ebay sellers are not required to collect taxes for sales to costumers in PA.

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This sounds reasonable.

But does this mean the same for Etsy?

I wonder if they have a physical office in PA.

Either way, the new fear is the greater possibility of them opening pandora's box even more to limit progress and profits.

[livadia]

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@dadsfloridatreasure wrote:

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No, @bradandamber.    Why would eBay/Amazon be responsible for paying sales tax?  *They(* didn't buy the item -- the buyer did -- and that's who will pay more just as they do when they buy something locally.

I disagree.  If eBay is going to follow Amazon and become the payment intermediate between buyers and sellers, then they should be responsible for collecting and dispersing the applicable sales tax.  When Ayden starts taking the payments, buyers will begin to pay eBay directly for purchases, not us.  We will no longer be paid directly via Paypal and have instant access to that cash.  That means technically eBay is going to be the merchant, no longer us as individuals.  It makes me wonder that eBay must have known in advance this ruling was going to happen and did plan in advance with Ayden taking over payments.

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@dadsfloridatreasure There's a difference between "paying" the sales tax and "collecting/remitting" it.    It makes absolutely no sense that eBay would *pay* sales tax on the sale of merchandise via their site that they never purchased or owned -- but collecting/remitting it on behalf of their sellers?  Yes, very possibly.

For example, Etsy uses Adyen already.  They are collecting sales tax FROM EACH BUYER at the time of purchase then remitting it to the proper authority in PA and WA as those two states recently enacted Internet Sales Taxes that require marketplaces (not individual sellers) to do so. 

As far your comment that with Adyen as eBay's payment processor, buyers will be paying eBay not the seller, no not really, any more than right now eBay buyers are paying PayPal, and not you.

Though eBay hasn't released specifics yet about how Adyen will work when it comes to eBay, I doubt it will be much different than how Adyen works on Etsy. 

Your money is accessible the next day after a sale is made.  You can set your account up to make daily deposits to your bank account if you wish though not everyone does because just like when you have been using PayPal as your processor, most like to have some working capital in their accounts to cover things like postage and listing/selling fees from sales proceeds.

As far as whether what eBay thought would happen with the Supreme Court ruling, I don't think that had anything to do with the decision to use Adyen for their payment processor at all.

Adyen's payment processing rates for the most part are cheaper than PayPal's plus they have more experience with handling a larger number of foreign currencies, credit cards, and other global payment methods, and have a track record in serving clients on a global scale. 

TBH, I think the Adyen decision was strictly based on cost/benefits, and one which helps support eBay's desire to keep expanding to other countries/markets worldwide.

[livadia]

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@dr.clockenstien wrote:

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@1ezdeal wrote:

That is wrong, the law in PA is that if the market place has a presence in PA they have to collect taxes from their third party sellers, since amazon has werahouses in PA they have to collect the taxes but ebay does not have any typen of presence in PA so ebay sellers are not required to collect taxes for sales to costumers in PA.

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This sounds reasonable.

But does this mean the same for Etsy?

I wonder if they have a physical office in PA.

Either way, the new fear is the greater possibility of them opening pandora's box even more to limit progress and profits.

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@dr.clockenstien   It might sound reasonable, but that's not why Etsy is collecting sales tax on their sellers' behalf and remitting it to both WA and PA.  Etsy is located in Brooklyn, NY.  They have no warehouses, satellite offices, outlet stores, or any presence in either of those states.

They're doing so because both WA and PA enacted Internet Sales Tax laws earlier this year which put the burden on online *marketplaces* (not indvidual sellers who sell on such marketplace sites) to collect and remit sales taxes for sales made via their platform.

Here's link about it as it pertains to Washington state.  There's also a link to what's the deal in Pennsylvania near the top of the blog post:  https://blog.taxjar.com/etsy-washington-sales-tax/

HTH

[southern*sweet*tea]

General reply

https://www.marketwatch.com/story/etsy-and-ebay-sellers-hold-their-breath-over-supreme-courts-sales-...

"Online retailers that host small businesses, like eBay and Etsy, would be responsible for collecting the sales tax, said John Buhl, spokesman for the Tax Foundation, a think tank based in Washington, D.C. Small businesses selling goods on these sites will charge their customers any additional sales tax. Sellers may also see increased administrative costs as they manage this new sales tax regime."

and

"Today’s ruling is limited to large online retailers and confirms that small businesses are clearly viewed differently by the court,” eBay said in a statement to MarketWatch. “Now is the time for Congress to provide clear tax rules with a strong small business exemption.”"

[maltzhu]

I'm curious to know if tax will be collected retroactively.  Also, how to collect when some sates do not tax everything that another state might.   Will used goods be exempted?   

And when the inevitable glitches show up here, there and everywhere, will anyone be refunded for being incorrectly or overcharged?   Sent a bill from their local department of revenue for not paying enough?

Nearly everything I buy from Amazon has sales tax added EXCEPT those items that my state doesn't tax.   Amazon DOES have a fullfilment center in this state.

There are alot of questions that need to be answered.  Nobody here, buyer or seller, has any money to squander on half arsed legislation and software, that's for sure.  It wouldn't enrage so many people IF the taxing authorities who want the cash so badly would squander less of what they already get.  With wages being stagnant for most, how much more can we really give?

[vintagecraze50]

Yeah it is way to complicated for sellers to have to pay each individualt state the taxes owed. If they are smart they will do the overall tax for internet sellers or have to spend three years trying to collect taxes the other way becuase the other way is WAY to complicated to work out.

[vintagecraze50]

The internet sales tax thing was bound to happen as people shop more online than ever before and would not be surprised if internet sales far surpass brick and mortar sales in the years to come.

[gipsytim]

I'm out. 187 fixed price listings deleted. Seven auctions left and unfortunately one has a bid (never thought I'd say that). It all be over by Sunday which gives me enough time to shut down my eBay Store before July. Don't forget it was the Republican Party that screwed small businesses. This thing would have never passed without the votes of Alito Gorsuch and Thomas. Some of the liberal justices even voted against it. The Democrats can impeach Donald Trump with my blessing now. I don't care anymore!

[gipsytim]

Exactly. You can bet there will be two different sale tax rates in states like criminal South Dakota soon. A tiny little sales tax for in-state sellers and a huge whopping sales tax rate for everyone else.

[vintagecraze50]

Thanks for the detailed post on how small business are viewed differently than large retailers.

[carlmarxx]

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@gipsytim wrote:
I'm out. 187 fixed price listings deleted. Seven auctions left and unfortunately one has a bid (never thought I'd say that). It all be over by Sunday which gives me enough time to shut down my eBay Store before July. Don't forget it was the Republican Party that screwed small businesses. This thing would have never passed without the votes of Alito Gorsuch and Thomas. Some of the liberal justices even voted against it. The Democrats can impeach Donald Trump with my blessing now. I don't care anymore!

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yeah! iT WAS Republican Party  that blocked Pres. Obama  from getting the supreme  court judge  pick  in ! 

[somanypostcards]

There are 3 activities that determine what is a Marketplace facilitator.  The first is:  

1. Facilitates the sale of a marketplace seller’s product through a marketplace for payment.

Since eBay is not at present "a marketplace for payment" (it uses PayPal), probably that's why it doesn't collect and remit Washington and Pennsylvania sales tax.  Amazon and Etsy are marketplaces for payment and thus do collect and remit these taxes.  

Today I learned there are 10 states which require sellers who don't collect the sales/use tax to inform buyers from those states that they owe state use tax.  So if I don't collect a Washington sales tax I need to inform every Washington buyer that they owe the tax.  I don't even know which other states require this notification...

Also some states have lower sales tax for senior citizens.  Again, I don't know which states or taxing localities have such discounts.  And does it mean I have to ask everyone if they are a senior citizen?

I own my busines, I am the only employee, I keep manual records, I file my own taxes, I do all the buying, listing, selling, mailing, accounting, etc.  There is no way I can handle 10,000 tax venues, their varying rules and regulations, filing requirements, et al.  Today's SCOTUS ruling means existing laws such as South Dakota's take affect today and laws such as Washington's and Pennsylvania's are valid and took affect when they were drafted at the start of the year.  I think this is putting me out of business...  at least until Congress passes laws that standardize taxes and/or provides a dollar sales limit for small businesses that is high enough to allow me to continue selling.

[swappart]

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@the*dog*ate*my*tablecloth wrote:

Right now people are charging sales tax within their states so it makes sense to charge the seller location rate.

Once they start remitting to other states the tax will have to be done on the buyer's location. It won't make sense for me to collect MA state sales tax for someone I'm selling to in PA to remit to PA. PA is not going to want to keep track of rates in other taxing locations. They will want to tax on their own rates.

PA is going to want PA sales tax, especially if it's higher than MA sales tax. Once you're talking two different states, what we do now will be out the window.

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After doing some research, including reading the SCOTUS decision, I believe you are correct. It seems the sales tax would be remitted to the buyer's state. This is actually a good thing though because that means the buyer would see the same tax rate irrespective of who or where the seller was, and you wouldn't end up with sellers in low or no tax states having an unfair advantage. 

[gew6463]

I'm confused; is it 200 sold items total (all states) or 200 sold items in one particular state (that requires taxes being collected)? 

[tealt]

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@gipsytim wrote:
...You can bet there will be two different sale tax rates in states like criminal South Dakota soon. A tiny little sales tax for in-state sellers and a huge whopping sales tax rate for everyone else.

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I suspect that politicians in at least 45 states are now drooling with anticipation.  I can almost hear them...

"Wow!  We can now tax ALL internet sales!  No physical presence here required.  Let's get busy and write some laws!  More money to spend!"

I'd guess that by this time next year 45 states, at least, will have laws taxing all internet sales.

I also suspect that no matter how high the minimum sales required for a business to be taxed starts out, that minimum will drop as the years go by.  Politicians always need more money to spend.