Why do Final Value Fees include Sales Tax?
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‎02-22-2022 11:41 AM
I, like many of you, think that eBay's Final Value Fees are getting too high.
However, my issue for the moment is the way the fees are calculated. I just sold an item for $1,150. After the buyer paid, the total amount, with shipping and sales tax, came out to $1,273. My Final Value Fee was based on that amount, even though I personally didn't collect the sales tax (eBay did). My total fees for this sale were $160 (which is 12.55% of the sale including shipping AND sales tax, plus a $0.30 eBay fee).
I understand why eBay bases the FVF on the total + shipping (because in the old days, people would sell something cheap and then charge hundreds in shipping fees in order to bring down the FVF). But why the sales tax???
This sale ended up costing me an additional $13. It's not the end of the world, but maybe some who understands the policies better can explain it. Why should my FVF include the sales tax?
Side note: I really miss when all categories had tiered FVFs (where larger amounts got a reduced FVF). Some categories still have this, but it was really nice when it was across the board.
Thoughts on sales tax being included in the FVF calculation?
Thanks!
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Why do Final Value Fees include Sales Tax?
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‎10-20-2022 02:16 PM - edited ‎10-20-2022 02:17 PM
@smashpenny wrote:I understand why eBay bases the FVF on the total + shipping (because in the old days, people would sell something cheap and then charge hundreds in shipping fees in order to bring down the FVF).
This has absolutely nothing to do with why they are charging it now. If you purchase shipping thru eBay they know exactly what you paid. If the fee was because eBay is worried about being cheated they could easily waver the fee if you purchased shipping thru eBay. It is just a standard business practice now.
This sale ended up costing me an additional $13. It's not the end of the world, but maybe some who understands the policies better can explain it. Why should my FVF include the sales tax?
Because they can. eBay has not lost enough customers over this so it is not likely to change. Another standard business practice.
Side note: I really miss when all categories had tiered FVFs (where larger amounts got a reduced FVF). Some categories still have this, but it was really nice when it was across the board.
They still do this. Have you not looked at FVF's for a while? Admittedly, the larger amounts have risen to the point that many sales will never get to the reduced rates. I remember in 1998, selling a item for $8000 and I had to pay the max FVF of $75.
If you notice the FVF is no longer broken down as two fees. Use to show the FVF and the Money Processing Fee as two separate fees. Now it is just one fee. I asked about how this works with a Local Pick Up and the Seller is paid in person. Since eBay did not process the Money what is the fee. Example, it use to be FVF 10% and Money Processing Fee 2.9%. I was told the fee is as stated and there is not a lessor fee because Seller was paid in person even though eBay did not process the money.
Why do Final Value Fees include Sales Tax?
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‎10-29-2022 06:40 PM
I always thought charging a fee to collect any kind of tax was federally illegal. I'm certain the IRS would have an issue if I as an employer deducted another $50 bucks outta each employees' paycheck to cover my cost of processing their payroll tax payments to the IRS. Doesn't the 12.9% cover costs of doing business already. Buyer was charged 10.75 for shipping- I get why shipping used to be included but their own shipping portal ships it for $8.something - wouldn't that be what they actually charge the buyer? So they overcharge the buyer and underpay the seller. Umphhhh - I'm out.
Why do Final Value Fees include Sales Tax?
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‎10-29-2022 08:50 PM

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