eBay Now Charging Sales Tax Everywhere

[cmtella]

I received a note today from a buyer requesting to cancel a $300 transaction because he was being charged $31 in sales tax even though he does not reside in my state. It looks like eBay has rolled out the uniform sales tax rules under the Quill Supreme Court case although I saw no announcement about it anywhere. I imagine this will be a significant issue going forward as eBay took no steps to educate buyers or sellers that this change will be rolling out.

[almasty]

Weird that a buyer would cancel for that reason. Ebay did give warning about sales tax being implemented this year for certain states. I’m unsure of how they told buyers about it, but I am sure that in their updates in selling manager they had one in December to remind sellers that it would be implemented this year (on a phone now without access to a computer to verify the date, sorry). They had also advised sellers earlier in the year that this was happening.

I’ve had several sales since January 1st with the new sales tax indicated on Ebay no problems with buyers.

The sales tax has already been collected by Amazon for many states on that platform for over a year now.

[cmtella]

To clarify, my buyer is in Washington. It’s possible that eBay is only doing this for a few states, but I can’t tell at this point.

[MDC Galleries & Fine Art]

It’s a bummer, but it’s coming. Your buyers state is a 10% state also. If he lived in a 6% state that would be $18.

Until this sinks in and buyers figure out it is not us sellers who are trying to do something fishy they may think they can just go shop elsewhere. But sooner later it will become a reality, sink in and realize it is there own states percentage rate and a new law, and it is going to be applied across the board.

A friend of mine was telling me, one way he was going to try to “offset” some of the sales tax, is to start looking at the location of who he is buying from for common, everyday supplies and to start buying his supplies from vendors who are very close to him which would lower his shipping costs somewhat and that may help “offset” what he will now be paying in Sales Tax. Interesting idea, but if buyers start doing this, that will hurt sales.

We are located in Atlanta and FL is our largest buyer state but California is second. If all those buyers start to look at a sellers location and try to buy only from someone who is 100 miles away instead of 3,200 miles away, then some buyers may not buy from us. Again, on unuslaul hard to find items, there may not be another one closer to them or even available at all, but throws just another wrinkle into the mix.

MIke at MDC Galleries and Fine Art.

[Inglewood]

Good for me, but bad for Americans is that I had a buyer from the U.S. leave a note on a purchase today saying “Thanks for not charging tax”. They were from Illinois. Didn’t understand it at first but maybe tax was being charged on similar items they were looking at.

Strange a law would be enacted to give foreign sellers an advantage.

[Jay]

Let’s not jump to conclusions without documented evidence. There is no nationwide internet sales tax. eBay made an announcement back in January:
https://community.ebay.com/t5/Announcements/Upcoming-changes-in-how-Internet-Sales-Tax-may-apply-to-your/ba-p/28962962

What this means for eBay sellers: Regardless of where you’re physically located, if you sell to buyers in certain states, those states may require you to collect applicable taxes on your transactions.

Therefore, based on these new laws, we will calculate, collect, and remit sales tax for orders shipped to customers in the following states on the following schedule:
Washington—starting Jan 1, 2019
Pennsylvania— starting July 1, 2019
Oklahoma—starting July 1, 2019

Once we start collecting tax in these states, you do not need to take any action. There are no extra charges or fees for this service. Prior to these dates, please continue to collect and remit tax in these states and comply with any other applicable requirements they impose.

There are no opt-outs for selling items into the states listed above, or out of eBay automatically collecting sales tax for items shipped to the states above. Additional states will likely be added to the above list. Stay informed on the Help pages.

So if your buyer was in Washington, the collected tax was expected. As stated, more states will no doubt come online with taxes soon.

The reality is that these taxes will affect every single person who sells online, so I don’t see it as a threat. I’m just glad that eBay is collecting and paying the tax without us having to do anything. As sellers, I dont see anything we need to do different.

[buytikiselltiki]

The past few things I have purchased have come up with a message that PA sales tax was not withheld, and I might be responsible to pay it.
This has been part of the tax code here for some time.
For small sellers, hard to say what the effect might be, or when.

Also enjoyed paying sales tax for my “free” quarterly eBay shipping supplies.

Gosh the 90’s were great!!!

[Incompetent Picker]

Here’s a good overview of the issue:

https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section4

[Jay]

Paying income tax on eBay sales
By law, sellers have to declare and pay taxes on income earned from eBay sales. We recommend checking with a tax advisor to understand your responsibilities.

I wonder if eBay is going to add the tax the buyer pays to our 1099? Or if they dont consider the tax income to us because we never touch it.

[toniwill]

I hadn’t listed any new items in one to two weeks, although I have relisted some items using “sell similar.” Today I got back in the saddle and after attempting to list one item I got the dreaded red letter message saying

“It looks like there’s a problem with this listing.
The selected tax rate is lower than the minimum allowed value, or greater than the maximum allowed value.”

I assume this is tied to the tax they are now collecting. I looked up tax rate and found how to change it through Site Preferences, Sales Tax Table. I don’t know what to do now–all the states are blank. Please advise; can’t list.

thanks,
toni

[Jay]

Are you able to choose the tax rate when you list? From eBay’s announcement, I thought that eBay was collecting what was necessary and submit payment to appropriate states.

Once we start collecting tax in these states, you do not need to take any action. There are no extra charges or fees for this service.

[toniwill]

On the tax table page each state is listed and one can put in the %. I had nothing on anything, but checked Clear All, then save. Got msg “This feature is temporarily unavailable. Please try again later.”

WTH–guess I’ll have to call.

thanks Jay. 🙂

[WisePrey]

You can only charge buyers a sales tax in states that you have a resale certificate / tax license setup for you to actually be able to pay the sales tax you collect.

You can’t collect sales tax from buyers from a state if you don’t have the certificate so you can actually pay it to the state.

[Retro Treasures WV]

That’s the old law. Everything is in flux right now after the supreme court ruling.
States can now require sales tax for all online purchases their residents make.
It’s a mess for small businesses like us.

[T-Satt]

WisePray: You and Retro are both right.

We charge, collect, and remit sales tax for sales in Colorado since we are located in Colorado (so we have nexus per the old law).

With the new laws being passed in some states, eBay (and Etsy) are charging, collecting, and remitting sales tax on sales to buyers in those states. Washington has had this with Etsy for some time, and EBay just started this year.

I double checked our sales to Washington this year (had 3 already), and eBay has the message to us that they collected and will remit the sales tax. I double checked our PayPal transactions for those sales, and we didn’t receive the sales tax amount (like we do in Colorado), so eBay has to remit that. Perfect, as they are doing all the work for us.

[toniwill]

To follow up on my problem above: Instead of calling ebay I first tried starting anew on the same listing. Bingo, it went through without a hitch. Must’ve been a glitch on their end, but it gave me a scare. 🙂

[Author]

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