Paypal Fees On Sales Tax

Keeps getting worse. Now ebay is passing on paypal fees for collected tax to the seller. It adds up....

Glad I live in Oregon - no sales taxes here.

I hate to say it but ebay is slowly becoming unusable with all these fees and taxes the site will become to expensive to sell on in the long run. There has already been a huge drop in ebay sales in Q4 possibly because of sales tax added globally on ebay sites. If I buy from USA these days they also charge import tax with GSP its just worse and getting worse year by year.

In layman's terms, sales tax applies to the total amount you pay to acquire a taxable item or service.

Snakes

This is no different from what a brick & mortar store pays to a traditional credit card company when someone makes a credit card sale. They pay their percentage on the entire amount swiped, including sales tax.

This isn't unreasonable. It is standard business practice.

The difference, of course, is that the tax collection and remittance obligation isn't mine, it's ebay's. I'm being charged for ebay to do the job the state imposed on it.

(and paypal isn't a credit card).

And as far as I know has always happened. Paypal has always charged fees on the entire amount regardless of how it breaks down.

Sales tax on the processing fee is a logistical issue not a tax obligation.

Another little known (off this topic though, my apologies) fact is that Federal law prohibits surcharges when using a debit card to pay even if the card is used as a credit card transaction. I have argued this point with many a business including auction houses.

I'm sorry, but you are effectively wrong on both counts.

1. ebay is not charging you any fees on the sales tax. ebay did not raise its seller fees or store subscription costs after they implemented sales tax collection. Only PayPal is charging you any fees on the sales tax component of the transaction amount, and that is normal business practice.

2. PayPal is a 3rd-party payment processor, the same as a credit card company/bank. GooglePay, ApplePay, SamsungPay, etc. also fall into this same category and charge the seller/merchant fees on the entire amount swiped. There is no exemption or deduction for a component of the transaction that is state/regional/local sales tax.

….and the business deducts the fees at tax time.....

You are very much wrong. I HAVE NO SALES TAX COLLECTION OBLIGATION OUTSIDE OF OHIO. ebay is forcing the sales tax collection FOR ITS OBLIGATION through MY account and *I* am being forced to pay for it.

You're making no sense. Are you saying that ebay is charging you special extra fees for sales tax that no other seller pays? How exactly are you "being forced to pay for it"?

The Marketplace Facilitator laws override individual seller thresholds for sales tax collection. ebay is obligated BY LAW to collect and remit sales tax for certain states REGARDLESS of individual seller obligations.

They don't have a choice in the matter.

I know that ebay doesn't have a choice in the matter. But that doesn't authorize them to force the tax money through my account so I pay the transaction fees associated with collecting THEIR tax liability. I certainly didn't consent to it. They are likely to get at least one class action lawsuit over the practice.

I don't understand this, if ebay collects sales tax on my sales it's invisible to me. I only see the sale Price + shipping in my Paypal account.

Are you in managed payments? It may make a difference. (I'm not).