eBay

velvet@ebay · ‎05-03-2022

Hi everyone –

We know you might have questions regarding the email you recently received about eBay Canada collecting Canada Sales Tax (GST/HST/QST/ PST) on behalf of our sellers. Please feel free to leave your questions and comments here and we’ll get them answered as soon as possible. Keep in mind there could be a delay as we check with internal teams to ensure we’re getting you the right answers to your questions.

Thanks for your patience!

reallynicestamps · ‎05-03-2022

There are many exceptions to taxable sales.

(See what I did there? Not items that are exempt , but sales that are exempt.)

One is groceries.

And there can be some oddities there too.

A single donut is a snack and the sale is taxable.

A box of six donuts is groceries and no tax.

Next shopping, read the supermarket tape about the sale.

The toothpaste sale was taxed and the toilet paper, but not the carrots nor the frozen peas and carrot nor the tetrapak of carrot juice.

BTW- used goods are taxable - or again, the sale of used goods is taxable - look at your tape from the thirft store or the contract from buying that used Subaru.

canada_goose_whisperer · ‎05-03-2022

@marnotom! wrote:
@msau4301 wrote:

I don't think anyone would charge tax at a garage sale, used is used! But as per usual, nothing we can do about it.
People holding garage sales generally aren't registered to collect GST/HST and/or provincial sales taxes, so that's why used items sold at garage sales aren't charged tax. It has nothing to do with the item being used.

Used items sold by retailers such as Value Village or have taxes charged on them if taxes apply to the item itself, not its "new" or "used" state. Used cars are also subject to taxes.

cc: @canada_goose_whisperer

@marnotom!Sure, but would you not agree that the intent of Value Village is to collect donated goods and resell them at a profit? In which case of course hst should apply because you are buying from a business/service.

If Joe from across the street is selling his old golf clubs, the intent of sale is entirely different. He's not offering warranty support, returns, etc... he's just selling a pre-owned good that he wants out of the garage. I'd argue there is no service being provided, and no value being added to the product before the sale to his neighbour Steve.

jwstewart.shaw · ‎05-03-2022

I have a question. Does this apply to all eBay accounts, or only Business accounts?

Because when I called the CRA GST/HST Rulings center today at (800) 959-8287 I was told that it is NOT neccessary to collect GST for the sale of used personal property, by an individual. (He used selling it on eBay or Kijiji as a specfici example) The agent said if I were in the business of seling used goods and had revenue exceeding $30,000 in the last 4 quarters, I would need to collect and remit GST.

So does eBay take into account this long standing and still effective fact that individuals selling thier personal property are not required to collect GST?

-----

Edit: A reply to your question can be found here.

canada_goose_whisperer · ‎05-03-2022

@jwstewart.shawThank you for that number, I will give them a call as well.

velvet@ebay · ‎05-03-2022

@reallynicestamps wrote:

velvet@ebay Since both you and jasmen@ebay are currently assigned to the Canada Boards, should we plan to pelt you specifically with sales tax questions?

Or nag both of you indiscriminately?

With 10 provinces and three territories, plus at least three forms of sales tax in play, to say nothing of those ITC credits, it might be best if one of you takes on this important topic.

Ghu help you.

It would be best to tag us both @reallynicestamps! That way at least one of us will see it and be able to help. We're also working closely with CA to ensure we get you accurate info. 😊

cobaltbluedragon · ‎05-03-2022

For those who are already required to pay GST and PST, this new policy sounds excellent, and will probably save them much time, effort, and stress. Good for eBay, good for the sellers, good for the customers.

However, the new policy is definitely inequitable to small resellers who are not required to pay GST or PST, in several ways.

First - as a small seller, not having to charge GST or PST is one of the few advantages that help offset the higher overhead costs of being a small volume seller and keep our pricing competitive. We will now need to lower prices by 13% to keep the same small advantage. How many small sellers have this margin to play with?

Second, who will receive these funds that we are not legally required to pay? The Federal and Provincial governments, or eBay? Respectfully, I don't like either idea - my governments receiving money they are not entitled to, or eBay keeping the funds for itself.

Third, this policy means GST and PST will be collected on my sales but I will be unable to receive credit for GST and PST that I pay on items to resell. Again, not very fair.

And fourth, eBay customers who buy my products under the new policy would in fact be paying taxes they are not legally required to pay by the Federal or Provincial governments. This doesn't seem right to me as a seller, or as a buyer.

Surely there must be some way for eBay to set up the system so that those who are not required to pay GST and/or PST, to opt out?

Lorey Simpson

(cobaltbluedragon)

-----

Edit: A reply to your questions can be found here.

mlecorre · ‎05-03-2022

1) So if I live in BC and sell to a client in Alberta, which PST sales tax is charged, the Alberta or the BC?

2) Is the sales tax charged to the buyer or does it come off the sellers proceeds?

grade_eh_coins · ‎05-03-2022

Leaves me with no option, again. Please expect the closing of my store prior to July 1st.

William Keith

simcity_pulls · ‎05-03-2022

This is a joke. Already raking fees from us now going to be charging tax. This is absolutely ludicrous. Way to ruin eBay for your loyal sellers.

lucitabby · ‎05-03-2022

Alberta has no PST

marnotom! · ‎05-03-2022

@jwstewart.shaw wrote:

I have a question. Does this apply to all eBay accounts, or only Business accounts?

Because when I called the CRA GST/HST Rulings center today at (800) 959-8287 I was told that it is NOT neccessary to collect GST for the sale of used personal property, by an individual. (He used selling it on eBay or Kijiji as a specfici example) The agent said if I were in the business of seling used goods and had revenue exceeding $30,000 in the last 4 quarters, I would need to collect and remit GST.

So does eBay take into account this long standing and still effective fact that individuals selling thier personal property are not required to collect GST?

You've missed an important point. As a marketplace facilitator, it will be eBay, not the seller, that is collecting and remitting any sales taxes due on the sale.

This is similar to the "internet tax" that has to be collected and remitted by eBay for sales to most US states now.

cc: @canada_goose_whisperer

reallynicestamps · ‎05-03-2022

@jwstewart.shaw

it is NOT neccessary to collect GST for the sale of used personal property, by an individual....The agent said if I were in the business of seling used goods and had revenue exceeding $30,000

The entity collecting and remitting the tax is eBay not the seller.

EBay is the venue for a lot more than $30K in sales daily, never mind four quarters.

Yours was the basic arguement that was brought before the US Supreme Court , by eBay and many other online shopping sites, when the American states wanted to collect the sales taxes they were missing when residents bought from out of state.

While US courts don't have jurisdiction in Canada, the decision that the venue was responsible for collecting the taxes was accepted by Canadian government.

marnotom! · ‎05-03-2022

@cobaltbluedragon wrote:

However, the new policy is definitely inequitable to small resellers who are not required to pay GST or PST, in several ways.

First - as a small seller, not having to charge GST or PST is one of the few advantages that help offset the higher overhead costs of being a small volume seller and keep our pricing competitive. We will now need to lower prices by 13% to keep the same small advantage. How many small sellers have this margin to play with?

Second, who will receive these funds that we are not legally required to pay? The Federal and Provincial governments, or eBay? Respectfully, I don't like either idea - my governments receiving money they are not entitled to, or eBay keeping the funds for itself.

Third, this policy means GST and PST will be collected on my sales but I will be unable to receive credit for GST and PST that I pay on items to resell. Again, not very fair.

And fourth, eBay customers who buy my products under the new policy would in fact be paying taxes they are not legally required to pay by the Federal or Provincial governments. This doesn't seem right to me as a seller, or as a buyer.

Surely there must be some way for eBay to set up the system so that those who are not required to pay GST and/or PST, to opt out?

Seeing as you're not collecting or remitting the taxes that eBay will have to levy on Canadian sales, I'm not sure why you feel it's "unfair" that you don't get ITC out of the deal.

As for your customers who may be charged GST/HST/PST unnecessarily under the scheme, it would be up to them to take that up with either the federal or provincial treasury. Perhaps they qualify for ITC?

Remember, eBay isn't doing this for funsies and Amazon has already been doing something similar for almost a year. Any concerns should be taken up with the feds, but I suspect that ship has already saled.

bigpsycho00 · ‎05-03-2022

So question to sellers who are not store owners ...what other site(s) you can recommend because with a 13% sales commission including taking a cut on shipping for ebay it is becoming harder and harder to sell an item.

Thanks for the help - i guess i will have to stop selling before july 1st 😞

msau4301 · ‎05-03-2022

You are absolutely right! As a vintage collector I'm no stranger to Value Village, and yes of course their used items have tax added (again!)...thanks for pointing that out! We tend to get spoiled when we get away with something for a while. At least we're all in the same boat! (Let's hope the weight doesn't make us sink!)

P.S. This is quite the extended thread! I think it was at 50+ responses, quite the topic to get everyone going I see!

deb183 · ‎05-03-2022

Yes that is exactly my position, I am on ebay as a business not as an individual . I have been in business et over 25 years. I employ the ITC form and credit the difference between tax collected and ITC credits.

I am anxious also to see ebays answer to this because if ebay is collecting and remitting on my behalf - how will that affect my own collecting and remitting. CRA will definitely have to be involved and it will be a complete nightmare.

deb183

mrdutch1001 · ‎05-03-2022

Please read and understand this taxation is applied to buyer's purchases!

"eBay Canada Limited (“eBay”) will be required to collect Canadian sales taxes (GST/HST/QST/PST) on applicable sales to Canada-based buyers."

"For sellers not registered to collect tax with the CRA and provinces, there is no action necessary. You will begin to see sales taxes charged and collected by eBay on buyer purchases beginning in July."