Who Pays Sales Tax To Who and How Much ?

[trader.jack]

So I read thru a number of Help pages and posts related to Sales Tax, but I am still confused. So let me ask these two questions as simply as I can.

1) If I am living IN Massachusetts and the Buyer is living IN Texas, which state is Sales Tax charged for ?

2) When I post an item, in the Listing Details section titled Sales Tax, should I be entering MY state (where I am shipping FROM) and the sales tax rate, or just leaving the section Empty ?

I am asking because the amount of sales tax charged on my sale makes NO SENSE.  Both states have a 6.25% sales tax rate, but the tax charged on the item was 7.5%. Even if they charged tax on the shipping it wouldn't be that much.Thanks

[mr_lincoln]

@trader.jack 

1. Sales - Use tax is based on the Buyer's state, NOT the Seller's

2. There may be a slim chance the Buyer's shipping address is different from Billing purchasing address.  One example could be a foreign Buyer who uses a US freght forwarding company, see where the Buyer is located through their Feedback History

3. You do not need to enter your state's sales tax, I never did but now it appears, the venue, eBay in this case, is collecting and remitting the sales tax

4. PayPal includes the Sales tax in their total to access your Fee

5. If nothing jumps out as being obvious call eBay and ask them why there is a higher tax rate then the Buyer's state?

[trader.jack]

1. Sales - Use tax is based on the Buyer's state, NOT the Seller's

That is what I would expect.

2. There may be a slim chance the Buyer's shipping address is different from Billing purchasing address.

Checked and both are in the same state.

3. You do not need to enter your state's sales tax, I never did but now it appears, the venue, eBay in this case, is collecting and remitting the sales tax.

Remitting the sales tax to the buyers state, right ?

4. PayPal includes the Sales tax in their total to access your Fee

Guess I get this, as it is a financial transaction.

5. If nothing jumps out as being obvious call eBay and ask them why there is a higher tax rate then the Buyer's state?

Guess I will have to do this, as it now makes even less sense.

THANKS !

[mr_lincoln]

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@trader.jack wrote:

1. Sales - Use tax is based on the Buyer's state, NOT the Seller's

That is what I would expect.

2. There may be a slim chance the Buyer's shipping address is different from Billing purchasing address.

Checked and both are in the same state.

3. You do not need to enter your state's sales tax, I never did but now it appears, the venue, eBay in this case, is collecting and remitting the sales tax.

Remitting the sales tax to the buyers state, right ? Yep

4. PayPal includes the Sales tax in their total to access your Fee

Guess I get this, as it is a financial transaction.

5. If nothing jumps out as being obvious call eBay and ask them why there is a higher tax rate then the Buyer's state?

Guess I will have to do this, as it now makes even less sense.

THANKS !

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Any time ... many here can help or at least still the cloudy water ...

[trader.jack]

Just sent E-Bay Customer Service an email asking how they are calculating this. Will let you know what they say.
Thanks

[luckythewinner]

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@trader.jack wrote:

I am asking because the amount of sales tax charged on my sale makes NO SENSE.  Both states have a 6.25% sales tax rate, but the tax charged on the item was 7.5%. Even if they charged tax on the shipping it wouldn't be that much.

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Without knowing the complete details of the transaction (State involve, the item price, the shipping charge, and amount of sales tax charged, the PayPal transaction math) we really have no information give you any guidance.

We have no way of helping determine whether the problem lies with eBay, PayPal, or you.

[corvettestainless]

You will never get an email response on this;

Sales tax varies per city/county in a state, so if the buyer only uses a 5 digit zip instead of 9 digit, they may be charged higher than they should be (highest will be charged in that 5 digit area). 

That's their problem, so I wouldn't spend anytime worrying about it. 

[buyselljack2016 · Accepted solution]

@trader.jack 

from the interweb:

The state sales tax rate in Texas is 6.250%. With local taxes, the total sales tax rate is between 6.250% and 8.250%. Texas has recent rate changes (Sat Feb 01 2020). Select the Texas city from the list of popular cities below to see its current sales tax rate.

[trader.jack]

Details are:

Order 01-04682-27415
Item 274305572508

Shipping from Westborough, Ma 01581
Shipping to Lubbock, Tx 79423

Subtotal USD 140.00
Shipping USD 15.30
Tax* USD 10.48
Total USD 165.78

[buyselljack2016]

Lubbock, TX Sales Tax Rate 8.250%

[trader.jack]

THANK YOU ! Now I get it !