04-29-2021 08:05 AM
It doesn't make sense that my fees should increase simply because of the tax paid by the buyer. Some states do not require taxes to be paid, and some do. When the buyer pays taxes to eBay, eBay will then forward those funds to the appropriate state. They do not get to keep the money. So if eBay is not allowed to keep the taxes, why are they profiting from them? It is wrong to charge sellers an increased fee based solely on what the buyer paid in total for the item, including taxes and shipping charges.
To be clear, here is an example: I sell an item for $100.00. The buyer pays another 10% in taxes for the item, meaning they paid $110.00 for the item in total. As a seller, I should be charged 10% of the final price of the ITEM, meaning I would be charged $10.00. However, I am charged $11.00, meaning that eBay is adding the amount of the tax onto my seller fee. It is a difference of only $1.00, but it adds up quickly over the course of many sales. Why are my profits being chiseled away based on what one state charges for their taxes?
Does anyone else feel that this practice is wrong?
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05-03-2021 06:55 AM
Thank you all for your input. It's good to hear from businesses with a brick-and-mortar store and how they differ from selling on eBay. While I understand that there is no real "standard" regarding online buying and selling, I do not understand why there has been no official response from eBay. Instead, I see eBay being represented and/or defended by the very same people whom they charge for doing business on their website.
I created this post because I was unable to find any straightforward answer prior to posting. By "straightforward", I mean an answer from someone with experience either as an employee of eBay or another similar business that can testify as to why this practice is necessary. I am not an expert on Federal law regarding private business practices in the United States.
I was fortunate to have parents who taught me the basics of human ethics and morals. The act of deliberately excluding information for the purpose of personal gain was not included in those lessons. It is slightly disturbing to me that I am not told the entirety of eBay's side to the user agreement. Though in hindsight, the same can be said of every other user agreement I've agreed to.
Regarding the comments about how businesses are charged for offering the use of credit/debit cards as forms of payment: I have yet to see a business without a sign or message that explicitly states that they will charge extra for not using cash. Every single gas station, mom-and-pop store, every local ice cream parlor I have ever been to informs their customers up-front about extra charges they may incur for doing business with them. It is my personal belief that eBay ought to follow that example and clearly list out every single charge that a seller may incur. Instead, they have a webpage with very little wording describing the seller fees, in which they do not even state how much or what percentage is charged.
I have concluded that eBay is able to profit off of charging taxes simply because they can.
04-29-2021 08:08 AM
Processors have ALWAYS charged a fee on the "full amount charged". Think 'credit cards being used in a Brick & Mortar store.
04-29-2021 08:09 AM
Look through this Board. You'll see plenty of posts objecting to this practice. None of them will change the practice. eBay is required to function as tax collector by the various states, and ebay is going to get paid for doing that one way or the other. This is the way. No one has to like it, but it isn't going to change.
04-29-2021 08:14 AM
Thank you. I have read through the board, but I have seen no official response from eBay regarding the practice.
04-29-2021 08:20 AM
Thank you. Where I live, I am not usually charged extra for using a credit card. I have been places that do charge a fee, but rarely. The point I was trying to make is that increasing a seller's fee based on two separate charges (being the price paid for the item and the tax paid for that item) seems unethical.
04-29-2021 08:26 AM
@brovahkiin wrote:Thank you. Where I live, I am not usually charged extra for using a credit card. I have been places that do charge a fee, but rarely. The point I was trying to make is that increasing a seller's fee based on two separate charges (being the price paid for the item and the tax paid for that item) seems unethical.
you aren't looking at it from the merchant standpoint....what THEY get charged.....
04-29-2021 08:50 AM
I don't believe ebay has responded. Really, there is no need for ebay to respond. You believe it is unethical. Fine. But it is legal, and some believe it is ethical. Of course, we would all prefer if ebay collected the tax for free, or even charged the states for basically working as their tax collectors. But the laws don't give ebay any choice. ebay (and other platforms must collect the tax). Given that they must collect it, and it is an expense for ebay, it is hardly surprising that they are going to pass those costs onto us in some way. I guarantee you, no one likes this, but it is what it is. ebay actually fought against the laws that require them to charge and collect the sales tax, but they lost. So here we are.
04-29-2021 08:51 AM
The funny thing is if you get Paypal instead of MP you DO NOT pay ebay fees on the Tax. ONLY the 2.9% paypal fee on the tax.
NO B&M Payment processor charges a 12-14% fee on Sales Tax.
So ebay dont have to charge on the tax or should only charge it on the processing fee (Approx 2.9%)
To charge 12-14% Fee on Sales Tax is a flat out RIP OFF!
04-30-2021 11:03 AM
Think 'Class Action Lawsuit'...
T
04-30-2021 11:19 AM
Really..?
They 'fought for us'...?
Did they fight as hard with the Fed as they did with the United States Postal Service the last few times ANOTHER rate hike was looming...?
No.
First they Asked Sellers to 'Join Forces' and PROTEST directly to USPS, as though eBAy were some frail orphan
begging for change on a street corner;
Then, when they saw Thousands of Sellers calling them weak, They STRUCK a DEAL with USPS to get eBAy's own 'Trading Card Postal rate' and allowed the PRIORITY MAIL RATE HIKE to happen, thereby
shutting down a ton of Sellers who were already on the edge of shutting down from the 'economy collapse';
eBay doesn't HAVE to take orders from anyone with the kind of power they wield, all they need to do is flex and the 'Government' will cower. They could tell the Fed tomorrow that the Sales Tax thing is killing small business and individuals who survive through online sales; and the Fed would say, 'OK then stop it';
and eBay would be NATIONAL HEROES overnight; but they obviously arent in it for benevolence purposes, so we can rule that one out.
Collecting Sales Tax was a BAD idea in the first place, now it's gotten to be another comprimised piece of a big pie that we the tax payers enjoy eating less and less of every day. BE it 'LEGAL' or not. Saying 'it is what it is' is taking the easy way out. Saying 'It sucks and it needs to change or stop' is where we see promise, instead of hopeless despair and failure.
Cheers. Good luck Sellers. Keep fighting.
T
04-30-2021 11:25 AM
You got it.
Absolutely correct.
A 'processing fee' is fine.
A PERCENTAGE of the final AMOUNT of Sales Tax is NOT OK...
Good job. Thanks
04-30-2021 11:28 AM
Wrong.
A 'processing fee' is a flat fee.
We're talking INCRIMENTALLY HIGHER percentage fees based on Sales Tax AMOUNT,
which is WAAAAY different and WAAAAY NOT RIGHT / Illegal perhaps...
believe me I'm looking into it being the latter...
04-30-2021 11:31 AM
@brovahkiin wrote:Where I live, I am not usually charged extra for using a credit card.
You're not charged, but the store you use the credit card is.
If sales tax is charged, the store pays a fee for it just like here.
04-30-2021 11:35 AM
@theloyalskeptic wrote:Wrong.
A 'processing fee' is a flat fee.
We're talking INCRIMENTALLY HIGHER percentage fees based on Sales Tax AMOUNT,
which is WAAAAY different and WAAAAY NOT RIGHT / Illegal perhaps...
believe me I'm looking into it being the latter...
There is nothing illegal about it, all payment processors base their fee's on the total amount paid by the buyer.
Pay Pal did to, but their fee's were lower.
04-30-2021 12:58 PM
Wrong; a processing fee is whatever I want it to be. If I want to charge you $5 plus 20%, and you continue to use my service, I will continue charging this 'processing' fee. If I want to charge you $1000 plus 98% of the total, and you agree to it by simply continuing to use my service, that's on you and I get to collect. There is no 'said' amount that is legal and fairness has nothing to do with it.
The largest waste of energy and time is thinking this practice is illegal.
Credit Card Processors have been charging stores a 'processing' fee- whatever they have worked out with that store, on the "full amount" of the charge (unless they charge a flat rate...which again; is totally up to the processor and the store to work out and is SELDOM the practice, always a percentage of the total). I have personal knowledge of 4 Chain Stores with 50 to 2000 buildings in the USA have paid a percentage of the Dollar Amount from 1990 to 2005 when I was in retail.