Is eBay causing shipping to be triple taxed within Canada? | Selling

pcdorney1 · 2023-05-30T23:18:23.865000Z

Hi, I just recently sold something on eBay (to someone else in Ontario) and before that it was years since I sold anything so a lot has changed. But I noticed something strange. eBay collected taxes on the tax on the shipping then charged eBay fees on both the shipping and collected taxes then taxed the eBay fee. For example:In Ontario the tax rate on most things is 13%. When it costs $10 to ship something I'm charged an extra $1.30 in taxes at the post office for a total shipping cost of $11.30. So on eBay the seller will need to pay me $11.30 for shipping. So far the government has collected $1.30 tax on the $10 or 13%. Then when eBay collects the money from the buyer they charge the buyer 13% tax on the total collected including shipping and the taxes on shipping. I never see this money. It passes from buyer to eBay who (I hope) is passing it on to the government. So at this stage eBay will send the government: ($10+$1.30)x13%=$1.47. So now for the initial $10, $2.77 or 27.7% has been collected in taxes. Then eBay charges an eBay fee on top of the total amount including the shipping, tax on "shipping" and tax on "shipping and tax on shipping". For the item I sold it was 13.25% though I guess it can vary depending on the category of the item. In this example the ebay fee on the shipping and related taxes would be: ($10+$1.30+$1.47)x13.25%=$1.69. I'm not sure if eBay is supposed to be charging a fee for collecting taxes? Then eBay charges me 13% on the ebay fee (so a tax on the fee on the shipping, tax on "shipping" and tax on "shipping and tax on shipping"). In this example the tax on the part of the ebay fee related to shipping and related taxes would be: $1.69x13%=$0.22. So total tax paid on the initial $10 for shipping is $2.99 or 29.9%. Does this seem strange to anyone else?

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Is eBay causing shipping to be triple taxed within Canada? | Selling | eBay Canada EN