Canadian TAxes on second hand item?

[laurob53]

Hi,

I'm not quite sure to understand why do we have to pay eBAY a taxes on stuff we're selling that we already paid a taxe on?  It's like paying 2 taxes on the same item....this makes no sense at all. Thanks.

[mrdutch1001]

BUYERS pay the sales taxes; SELLERS pay the FVFs on the TOTAL transaction (which does mean the FVFs are inclusive of the item price,shipping costs,sales tax all of which the buyer paid, BUT sellers will pay GST/HST on the TRANSACTION as per required to be collected by eBay)

[reallynicestamps]

If you were buying on eBay in most states (and soon in Canada) sales taxes are collected on used goods.

Here's a recent receipt I got from a local thrift store here in BC.

[laurob53]

I understand all that but it’s kinda weird to have to pay an additional tax on something that taxes has already been paid on it when it was new. I’m not a shop, I make no living from selling so I can’t get deduction on my yearly taxes by claiming my sales taxes here.

[laurob53]

It’s a thrift store…makes sense they add taxes since they are a business, but I am not. 😕

[marnotom!]

The line from the eBay "tax team" is that it's not the items that are being taxed, but the transactions.

While you might not be a registered business, eBay is, and buyers are using the services of eBay to faciliate the purchase of what you're offering for sale.  Just guessing here, but I'm thinking that someone somewhere has decided that that service is taxable.

[femmefan1946]

[fh991586]

Taxes are not specific to the fact that an item is new or used.  You'd buy stuff at an auction or in an antique store, and you'd expect not to pay taxes?

[men2ksm]

yes, but that is because the thrift store is a business. 

I sell rarely and my own things on Ebay, I am not a business, so my buyers would not be required to pay tax on my items if I sold them a different way.

I can only assume it's because in law ebay is the "seller" rather than me, but I don't think this accurately reflects the scenario.

[men2ksm]

so really it should just be the 12% taken by ebay that is taxed?

[marnotom!]

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@men2ksm wrote:

so really it should just be the 12% taken by ebay that is taxed?

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Nope.  Somebody at eBay didn't decide that its sales should be subject to GST/HST/PST.  Broadly speaking, our federal government did, and there's now legislation to the effect that sales made through marketplace facilitators are subject to sales tax, value-added tax, whatever you want to call it.

https://community.ebay.ca/t5/Canadian-Sales-Tax/How-We-Got-Here/td-p/478803

Similar taxes on goods purchased through online marketplaces have been in place in most US states for about two or three years now, as well as the UK, the EU, Australia, Norway, and other jurisdictions.

[loupei]

FVF stands for...?

Thanks

[marnotom!]

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@loupei wrote:

FVF stands for...?

Final Value Fees, i.e. the percentage of the total transaction charge (which included taxes eBay collects from the buyer) that eBay takes as its commission from the sale, which is in turn charged GST/HST by the feds.

[reallynicestamps]

If you are selling on eBay, you are a small business.

Garage sales which are held often may get a visit from the municipal bylaw officer about paying business taxes and a letter from the province about charging provincial taxes and another from their insurance company noting that they should be paying commercial rates.

But in any case the sales taxes are paid by the buyer, not the seller.  This has been true for the US for about two years, in Canada since July 2022, and for UK, EU and Australia as well.

We do pay fees on the buyer's ENTIRE payment, but that has been Standard Practice in the financial payment processing industry since at least the early '80s when we got our first merchant credit card account.

[reallynicestamps]

We tend to say 12.9% since that is the most common  FVF level, but these actually vary from 0.05% to 15% and may have a 5% surcharge for sellers who have accumulated Defects.

https://www.ebay.ca/help/selling/fees-credits-invoices/selling-fees?id=4822

[cib3rcat]

Used item are not suppose to be re-taxe you are all talking about ebay fee that is not the case we already know that they take some fee the thing is that used item other then cars are not suppose to be re-taxe this will stop the used sell item on the web .... I will never buy used item on the web if i need to be the second tax payer on and used item ... 

[mrdutch1001]

This topic is dead & buried....

@kh-leslie 

@kh-phdan 

 ZOMBIE THREAD FROM 2022

[marnotom!]

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@cib3rcat wrote:

Used item are not suppose to be re-taxe you are all talking about ebay fee that is not the case we already know that they take some fee the thing is that used item other then cars are not suppose to be re-taxe this will stop the used sell item on the web .... I will never buy used item on the web if i need to be the second tax payer on and used item ... 

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Unfortunately, just because you say that doesn't make it so.  Tax legislation was amended over a year ago that makes transactions on digital marketplaces (such as eBay) subject to taxes.

Non-charitable retailers such as Value Village also have taxes applied to transactions involving used items.

It's the nature of the selling venue and/or the tax registration status of the vendor that affects whether a transaction is subject to tax or not, not necessarily the nature of the item being purchased in the transaction.

[kh-leslie]

Hi everyone,

Due to the age of this thread, it has been closed to further replies. Please feel free to start a new thread if you wish to continue to discuss this topic.

Thank you for understanding.