Fees being charged for the amount of SALES TAX Ebay is collecting for each sale

0ldgeezer
Contributor
Contributor

I am really curious to know if I am the only seller who has caught on to this scam by Paypal. I have examined the last few sales I have had on Ebay. Ebay has charged the buyer for Sales Tax on the sale. Then that GROSS amount which includes the Item, Shipping, SALES TAX is collected by Paypal. Then Ebay pulls the shipping cost from my Paypal Account and and Paypal takes their fee from the rest of the payment (Including the SALES TAX). So for those last few sales I noticed a differnce of .03 - .04 more in Paypal FEES dues to the sales tax collected by Ebay. Why do I have to pay additional Paypal FEEs for Ebay to collect a sales tax which is not required for them to do directly (except for CA). I am not making any profit on the sales tax. The Sales Tax is a FEE for certain states being collected by Ebay, not by the sellers.

 

I have spoken to customer service at both Ebay and Paypal. I was told it was not them it was the other. So the merry go round is spinning and nobody it taking responsibility. So, I issued a complaint on Consumer Affairs, the NY State AG, and next to the BBB.

 

The Ebay policy on Sales Tax states:

"Once ebay starts to collect sales tax in the required states, no action is required on your part, and there will be no charges or fees for eBay automatically calculating, collecting, and remitting sales tax."

 

Obviously they don't follow their own policies.

 

 
 
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117 REPLIES 117

weneedtofight
Contributor
Contributor

Whoever that guy is with the solution is an idiot.
Paypal is scamming it's sellers, and something needs to be done about it. 
I'm going to start a class action lawsuit against them on these points. 

a) They are charging fees on sales tax.  We have nothing to do with the sales tax, therefore charging fees on it
    is immoral and illegal.

b) They are pocketing our fees when we issue full returns to customers.  They have lied to us stating this is industry standard, when they are essentially the only choice when selling on eBay.  There is no industry to standardize in this regard.

I hope you enjoy the lawsuit Paypal, because your actions of robbing money from your own customers knowing they have no other choice is deplorable.  The relationship you have with eBay essentially conspiring against your customers should be illegal business practices.  You cannot as two major companies, conspire to dominate and monopolize and entire section of an industry to force people to use a certain payment processor and not offer the ability to use any other type of payment.

You cannot steal money from people flat out with no reason.  Securing profits for your shareholders is not a reason. 
If your business model is unsustainable, shut it down.

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ramseydc
Contributor
Contributor

Consider that retail stores collect taxes and do not charge fees for their collection, so why should eBay or PayPal be allowed to collect a fee for collecting taxes.  Doesn't pass the smell test!   Need to send a letter to a lawyer for a class action law suit.  (Alan Dershowitz comes to mind)

 

Also consider sending letter to your Congressman or Senator for them to consider as an issue with the laws for online collection of taxes.

 
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Sdh001
Contributor
Contributor
I wonder if ebay receives back a half percent from the state they collect the tax for? Hmmmm in Nebraska if a business collects sales tax for the state they receive a portion for doing it. Shouldn't ebay be paying paypal for that portion if they are already receiving an amount back for doing it? Im not sure if this is accurate but am curious.
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ruffattola
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Contributor

is there a class action suit

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dwellupset
Contributor
Contributor

There needs to be a class action law suit, ASAP.

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Dangkness
Member
Member
Yeah man this is totally ridiculous! I just figured this out on my first sale on eBay I was wondering why PayPal charged me so much. I was charged 2.9% on the $20.90 sales tax on an item Which ended up being an extra $0.60 for PayPal. So In the hundreds of thousands of dollars a year they collect in sales tax for eBay they’re keeping 2.9% of that money out of their customers pockets that is absolutely ridiculous! They can’t do this! I’m complaining about this first thing in the morning when they open for business.
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it is not just Pay pal ,E bay jumping into the fees charged on sales tax..Just like charging you fees for shipping ,everyway they can **bleep** you

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I am not understanding about sales tax. I know that sales tax is being withheld from my sales, meaning I do not receive that amount, right? It is being held for paying sales tax? If they are taking it out for sales tax, why did I get a bill from the state comptroller telling me how much sales I had and how much I owe? Am I looking at it wrong? The way I see it the sales tax is being collected twice, once from the customer and once by me.

Can someone explain?

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ramseydc
Contributor
Contributor

This is what I would to in your situation:

 

Sounds like eBay did not notify your states comptroller that it collected and "paid ?" the state the taxes due on your sales.  (1) I would not pay the state a second time as it should have received the monies and getting it back might be near impossible.  (2) Inquire with eBay as to the status of the sales tax payments (due to your state) for your sales as you have gotten a request from your state comptroller to pay.  (3) Let the comptroller know that eBay has the monies due . This assumes you do not have a second source of sales that the comptroller is referring to.

 

 

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xpert66
Contributor
Contributor

First and foremost eBay and PayPal may operate as separate companies, the fact is eBay owns PayPal. What PayPal is now doing is TRIPLE DIPPING! Everyone seems to be ridiculously OK that paying final value fees twice via eBay and PayPal. It is wrong! And top this with paying PayPal fees on tax collected by PayPal for the state that sellers never see is a SCAM. Don't tell me they are collecting our money for us...That is what we are paying them for in the first place!

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