Became harder to compete on ebay since canadian sellers registered on .com don't charge tax

[lud-4367]

It's has become harder to compete on ebay as a hobby seller ever since ebay started charging tax by themselves. It's not that charging tax is wrong, but the problem is US sellers don't charge tax, and canadian sellers who registered on .com don't charge tax. I haven't had any sales for 3 weeks for the first time. I know there's inflation thing going on still, but zero sales for 3 weeks is unprecedented. I guess I should join the fun by setting up .com account, but then I wonder will it be changed eventually?   

[femmefan1946]

Your premise is wrong.

It's not the sellers who are charging taxes, it's eBay because they are mandated by various governments.

Canada just started in July, the USA in 2020, I believe, and Australia before that. Not sure about the European Union, but I have seen a customs number on shipping labels that indicate their VAT has been prepaid.

You should be able to see the tax on any purchase you make from a US seller shipping to you in Canada.However, you may be misled because so many US sellers use the Global Shipping Program which puts Canadian taxes in with "import fees", a term that covers the duty, sales taxes, and a service charge.

• Technically, you as the buyer do not pay these import fees, you pay  GSP which uses that money to pay the Canadian government.

I guess I should join the fun by setting up .com account,

That would be very difficult, because to get paid you need  a US bank account , a US address, and to pay US taxes.
Some oldtimer Canadian sellers set up accounts before there was an eBayCanada, and those got grandfathered, but I believe they still had to attach Canadian bank accounts.

In any case, the seller does not charge or remit or even touch those sales taxes. The entire process is handled by eBay, who charge the buyer through his invoice, based on the buyer's location. In turn, eBay charges the seller a fee for this service.*

*It's a service** because the seller does not have to know and charge 48+ tax percentages for the USA, plus 13 for Canada, to say nothing of the UK, EU and Oz.

**And sellers are not happy about this.

[lotzofuniquegoodies]

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@femmefan1946 wrote:

Your premise is wrong.

It's not the sellers who are charging taxes, it's eBay because they are mandated by various governments.

Canada just started in July, the USA in 2020, I believe, and Australia before that. Not sure about the European Union, but I have seen a customs number on shipping labels that indicate their VAT has been prepaid.

You should be able to see the tax on any purchase you make from a US seller shipping to you in Canada.However, you may be misled because so many US sellers use the Global Shipping Program which puts Canadian taxes in with "import fees", a term that covers the duty, sales taxes, and a service charge.

• Technically, you as the buyer do not pay these import fees, you pay  GSP which uses that money to pay the Canadian government.

I guess I should join the fun by setting up .com account,

That would be very difficult, because to get paid you need  a US bank account , a US address, and to pay US taxes.
Some oldtimer Canadian sellers set up accounts before there was an eBayCanada, and those got grandfathered, but I believe they still had to attach Canadian bank accounts.

In any case, the seller does not charge or remit or even touch those sales taxes. The entire process is handled by eBay, who charge the buyer through his invoice, based on the buyer's location. In turn, eBay charges the seller a fee for this service.*

*It's a service** because the seller does not have to know and charge 48+ tax percentages for the USA, plus 13 for Canada, to say nothing of the UK, EU and Oz.

**And sellers are not happy about this.

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@lud-4367 

@femmefan1946 

For a seller that is based in Canada(example Ontario) but lists on dot com in US funds and sells to a buyer in say Alberta does the buyer get charged 5% on the US total? Is the situation still whackadoodle for US(based) sellers who list on dot com selling to Canadians or are they considered exempt for eBay collecting tax? Do they only collect tax from Canadians if they have a Canadian presence (warehouse)? 

Only reason I ask is because I recently had a buyer registered in Hong Kong buy something from me and item got shipped to Manitoba. Consequence was International fee was applied(No idea if they paid in a foreign currency).

Do Canadian sellers who sell on dot com get dinged the international fee when they sell to another Canadian? What happens if the Canadian buyer is registered on dot com but pays in Canadian funds? Makes ones head spin thinking of the various ways this all is getting applied or if it is being applied correctly!! 🙃 Are there still perks to eBay to any of the so called "grandfathered" features? (Grandmother'd where applicable!!) Happy headspinning to all!!!

-Lotz

Back to regularly scheduled programming.

[femmefan1946]

I just got an order from Hawaii, sold on dotCA.

The Hawaii tax was charged by eBay to the buyer.

And the invoice shows me Canadian dollars.

So the country the seller is in is not important. The site the listing was on is not important.

EBay is charging the buyer his government's tax.

Perhaps someone who has purchased from the USA recently can confirm that they were charged Canadian taxes.

This is one reason why it actually is a benefit that eBay handles it much as we hate giving eBay any fees at all.

[lud-4367]

The question isn't about right or wrong. It's a simple question if it's useful to switch to .com or not. I just wanted to hear other people's predictions whether this "hole" which lets canadian sellers on .com not charge sales tax, will get shut down eventually or not. You wrote a quiet lecture, but nothing was answering my question. Just because you write on every single post here, don't think it would be helpful, or you are better than others. Don't lecture anybody. If you can't answer, just move on.

[lotzofuniquegoodies]

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@femmefan1946 wrote:

I just got an order from Hawaii, sold on dotCA.

The Hawaii tax was charged by eBay to the buyer.

And the invoice shows me Canadian dollars.

So the country the seller is in is not important. The site the listing was on is not important.

EBay is charging the buyer his government's tax.

Perhaps someone who has purchased from the USA recently can confirm that they were charged Canadian taxes.

This is one reason why it actually is a benefit that eBay handles it much as we hate giving eBay any fees at all.

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I just liken it to eBay stating that tax is being collected on the transaction yet for certain categories (if the item is assigned correctly) the tax is exempt. It's either 1 or the other. It can't be both. 

As for tax collection on imports that would have been best left to the border people. Afterall they are the experts and actually can see the physical goods when they go to apply tax and then NO fears of buyers being charged twice. Then it's their discretion as to it being charged or not charged vs it being charged across the board only as a money grab.

-Lotz

[mrdutch1001]

it matters not whether a Canadian seller lists on .CA or .COM, buyers will be charged the applicable taxes as per their location and as required by law.

[flipistics]

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@mrdutch1001 wrote:

it matters not whether a Canadian seller lists on .CA or .COM, buyers will be charged the applicable taxes as per their location and as required by law.

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I think the prior question people had regarding this was about the people who use a cross border shipper and list on .COM since they often mark their item as being physically in the USA, but then ship it to Canadians from Canada which bypasses the GSP or border collection.  I don't recall if that was ever resolved (or what issues they may be facing come tax season in the USA).

[marnotom!]

How were your sales this time last year, if you were selling in August 2021? Keep in mind that many sellers were enjoying a pandemic-inspired boost in sales in 2020 and 2021. I just returned to my small town on Vancouver Island from a short trip on the mainland and couldn’t believe how dead it was here. I’m thinking that as August zips to an end and the first day of school is in eight days that many people are either scrambling to get in some vacation time or else they’re recovering from mild COVID symptoms that developed while on vacation.

While taxes may put off some of your buyers, they’ll likely return once they figure out that most online marketplace sites are now having to collect and remit sales taxes on Canadian sales.

[maximus7001]

So here is how it goes for taxes with our accounts.

Our .com account with a USA address for shipping gets dinged for North Dakota state tax nomatter what. Quite a hit on a $600 USD item with free shipping to USA but way better than the $200 USD shipping to get the same item to Winnipeg if bought with our .ca account that still gets hit with 5% gst and 7% pst.

We sell diabetes supplies worldwide with .ca and .com with our Canadian address account. Almost every outside of Canada buyer gets charged state or federal tax except the few US states that do not charge and the few non EU countries that do not charge however within Canada there is never any tax charged in this category. When a EU, UK or Australia buyer has to pay vat it is really bad and expensive.

We recently bought a computer accessory item from Lenovo on ebay that shipped here to Winnipeg from USA and we got hit with gst and pst.

[biglittleape]

I'm not sure what "tax hole" you're referring to.  I sell on .com and eBay started charging tax on all my sales to Canada back in July.  I charged tax before that on my own but now eBay is forcing it which I prefer anyway.

What Canadian listings on .com do you see that are not charging tax?

[ricarmic]

My store is currently on vacation, but I was very surprised before I closed for vacation that the level of Canadian buyers did not drop after July 1st, it even possibly increased despite the fact that before July 1st I covered the taxes for my buyers and of course couldn't after that.

My (stamp) world is very international, so I expected a larger backlash of folks going elsewhere (ie buying from US sellers or other sites not yet having to collect the taxes) similar to what happened when the US IST (Internet Sales Tax) started.

[femmefan1946]

Okay.

You will find it very difficult to open a dotCOM account without a US address and a US checking account.

You will need to pay US taxes on your sales.

If they go over $600. eBay will report you to the IRS.

KISS.

[pjcdn2005]

We sell diabetes supplies worldwide with .ca and .com with our Canadian address account. Almost every outside of Canada buyer gets charged state or federal tax except the few US states that do not charge and the few non EU countries that do not charge however within Canada there is never any tax charged in this category. When a EU, UK or Australia buyer has to pay vat it is really bad and expensive.

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Diabetic supplies must not have gst on them  in Canada?   I put quite a few of your items in my cart, some of then listed on .Ca, some of them listed on a European site.  I was charged tax on all of them except for the diabetic test strips.  

Unless a US seller was shipping with the gsp, I'm not sure why you would have been charged tax by eBay when you purchased from a US seller.  EBay does not collect tax from sellers outside of Canada.   It's easy enough for someone to confirm that by putting an item from an international seller in their cart.   There will be no tax added.

I noticed tha5 if I shop on .ca and put a Canadian's sellers item in my cart, the gst shows up in the cart.  If I add tha same item on .com, I don't see the ts until I click on checkout.

[pjcdn2005]

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@flipistics wrote:

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@mrdutch1001 wrote:

it matters not whether a Canadian seller lists on .CA or .COM, buyers will be charged the applicable taxes as per their location and as required by law.

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I think the prior question people had regarding this was about the people who use a cross border shipper and list on .COM since they often mark their item as being physically in the USA, but then ship it to Canadians from Canada which bypasses the GSP or border collection.  I don't recall if that was ever resolved (or what issues they may be facing come tax season in the USA).

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I suspect that unless the seller's registered address is in the US, ebay will still charge tax to Canadians.  I would be surprised if they based the tax on the 'shipping from location'.  My guess is that it is based on the sellers registered address and as another poster mentioned, registering with a US address would cause other problems, namely with the IRS.  

Of course I can't confirm any of  that based on first hand knowledge. 

[pjcdn2005]

@femmefan1946 

EBay does collect tax when a US buyer lives in a state that has the online use tax.  This is regardless of where the seller is located.

eBay does collect tax when a Canadian buyer purchases from a Canadian seller regardless of the site.  EBay does NOT collect tax when a Canadian purchases from a US seller.  That is why the op is suggesting the playing field is not level in that sense.

[pjcdn2005]

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@lotzofuniquegoodies wrote:For a seller that is based in Canada(example Ontario) but lists on dot com in US funds and sells to a buyer in say Alberta does the buyer get charged 5% on the US total? Is the situation still whackadoodle for US(based) sellers who list on dot com selling to Canadians or are they considered exempt for eBay collecting tax? Do they only collect tax from Canadians if they have a Canadian presence (warehouse)? 

Only reason I ask is because I recently had a buyer registered in Hong Kong buy something from me and item got shipped to Manitoba. Consequence was International fee was applied(No idea if they paid in a foreign currency).

Do Canadian sellers who sell on dot com get dinged the international fee when they sell to another Canadian? What happens if the Canadian buyer is registered on dot com but pays in Canadian funds? Makes ones head spin thinking of the various ways this all is getting applied or if it is being applied correctly!! 🙃 Are there still perks to eBay to any of the so called "grandfathered" features? (Grandmother'd where applicable!!) Happy headspinning to all!!!

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No headspins here. The international fee has nothing to do with taxes or the currency used.  When a buyers registered address is in another country the seller is charged an international fee.  This is true now and was true with PP.  A Canadian who lists on .com still has a registered address here so you would not be charged an international fee.  

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[lotzofuniquegoodies]

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@pjcdn2005 wrote:

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@lotzofuniquegoodies wrote:For a seller that is based in Canada(example Ontario) but lists on dot com in US funds and sells to a buyer in say Alberta does the buyer get charged 5% on the US total? Is the situation still whackadoodle for US(based) sellers who list on dot com selling to Canadians or are they considered exempt for eBay collecting tax? Do they only collect tax from Canadians if they have a Canadian presence (warehouse)? 

Only reason I ask is because I recently had a buyer registered in Hong Kong buy something from me and item got shipped to Manitoba. Consequence was International fee was applied(No idea if they paid in a foreign currency).

Do Canadian sellers who sell on dot com get dinged the international fee when they sell to another Canadian? What happens if the Canadian buyer is registered on dot com but pays in Canadian funds? Makes ones head spin thinking of the various ways this all is getting applied or if it is being applied correctly!! 🙃 Are there still perks to eBay to any of the so called "grandfathered" features? (Grandmother'd where applicable!!) Happy headspinning to all!!!

---------         

No headspins here. The international fee has nothing to do with taxes or the currency used.  When a buyers registered address is in another country the seller is charged an international fee.  This is true now and was true with PP.  A Canadian who lists on .com still has a registered address here so you would not be charged an international fee.  

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Might be an idea for eBay to maybe send around reminders from time to time so buyers and sellers could update their information as required. It's possible for many eBay dot ca was not a thing when they registered for eBay. If you do a google search the information on how to change your country of registry shows up on dot com. Changing your country of registration is not even mentioned on dot ca(That I could easily locate). This makes for a fee only as a revenue generator when in many cases it's not applicable. Put another way if a buyer was registered properly then there would be no added fee to the seller. In my mind that would not be a bad thing.

https://www.ebay.com.sg/pages/help/account/change-country.html

If you switch above link to dot ca that link cannot be reached

Changing your country or region after you register

1. Go to the Change Registration Information page. ...
2. Once there, scroll down to the Country field and choose your country from the drop-down menu.
3. Click the change registration information button.
4. Review your changes and if they're correct, click the submit button.

https://www.ebay.ca/help/account/changing-account-settings/changing-account-settings?id=4193#section2

-Lotz

Remember when you registered with PayPal and they sent the test transactions? Worked like a charm. I believe that happened with some sellers after the fact with MP. (Didn't happen with me.) That may have resolved problems for many during their enrollment process.

[femmefan1946]

EBay does NOT collect tax when a Canadian purchases from a US seller.

You are right.

When a purchase is imported, it is CBSA that assesses duty and sales tax (over $20 Cdn for most of the world , $150/$40 for USA). And then Canada Post or the courier collects their service fee/customs brokerage fee.

And occasionally, the seller is set up to assess and remit Canadian taxes as a sub-contractor, just as the GSP does.

I guess my point is that when goods are imported there are costs just as there are when shipping domestically.

[pjcdn2005]

The site of registration isn't really relevant since tax info is based on the sellers/buyers address.