Final value fee for Canadian is calculated including tax paid by the US buyer to eBay_(1)

[123.chemist]

I am located in Canada and I attaching the calculation of my fees for my latest sale to a US individual. 
The Final Value Fee is calculated on a total amount of 2532$, which is based on the  sale price 2350$ PLUS the 180$ which represents the tax collected by eBay for his purchase. 
Why is this normal? I do not receive the 180$, it is collected by eBay for US tax purposes.

I would like to ask a eBay moderator to look into this and explain why this practice is utilized. 
Thank you for your help. 
PS: I will create a second message with the same title to attach the proof that this is a sale to US. 

[123.chemist]

Here is the second message on the topic of final value fee calculation for a Canadian, fee which included the tax amount collected by eBay from the US buyer and to be paid to the US government. 
I am attaching the proof that the sale was completed to a US person from US. 
The 180$ amount represents the tax established by the state of California and it is collected by eBay and paid to the state of California. It should not be part of the final value fee that the Canadian seller should pay to eBay. 
I would appreciate an eBay 's moderator's attention and opinion/resolution. 
Thank you for your help. 

[marnotom!]

Nothing needs to be brought to an eBay moderator's attention.  This has been discussed fairly extensively in the past.  This is how eBay works.

Brick and mortar sellers have to pay credit card merchant fees on taxes as well as the sale price when someone uses a credit card to purchase something from their store.  PayPal charges fees on taxes if they apply to a sale.

As a "Marketplace Facilitator," eBay has to collect taxes from states where an "internet tax" is levied on online sales.  No matter where the sales actually originate from.

The alternatives would be to either have sellers try to figure out how to remit internet sales taxes to the appropriate authorities, or else pay higher final value fees and have eBay remit the taxes on the seller's behalf for "free".

Have a look for other threads on this topic while you're waiting for more responses to this one.

[recped]

My opinion........

The system is working as intended. Sellers need to get over the "how" fees are calculated and just concentrate on how much the fees are.

Would you be happier if eBay eliminated the fees on Sales Tax and instead raised the percentage on everything else from 12.35% to 14.35%?

[pjcdn2005]

eBay charge fees on the total amount that eBay paid just as Paypal did. It is a higher percentage now than with Paypal and I doubt that most sellers are happy about it.  But after hundreds of posts complaining on both the .com and .ca boards, its unlikely to change.  Their fee info is fairly clear that fees will be charged on taxes as well as shipping.

We charge one final value fee when your item sells, and you don't have to worry about third-party payment processing fees. This fee is calculated as a percentage of the total amount of the sale, plus $0.30 per order.

The total amount of the sale includes the item price, any handling charges, the shipping service the buyer selects, sales tax, and any other applicable fees. If you offer 1-day or international shipping as well as a cheaper or free option (like domestic shipping), the total amount of the sale is calculated based on the cheapest domestic option you offer.

https://www.ebay.ca/help/selling/fees-credits-invoices/selling-fees?id=4822&st=3&pos=1&query=Selling...

Please don't post two threads for the same topic, if you get answers on each thread it can become really confusing. 🙂 You can post a screenshot within a thread when you are typing your post or reply by clicking on the paper clip type icon at the top of the post.

[femmefan1946]

We got our first credit card account circa 1978-79.

We paid the card processor (Moneris) the same fee on purchase price, shipping charged (if any we were mostlyB&M at the time) and on Ontario Sales Tax.

When the GST was introduced we paid the credit card fees on that too.

It's a Standard Business Practice.

It's legal.

It's not popular with merchants.

[123.chemist]

Thank you all for taking the time to read and comment.

I understand all the arguments everyone has brought forward and in the end is the price of doing business.

I am however thinking that one aspect of all this "who pays fees on taxes" matter should, or could be further refined, as I presume that the rules of the engagement work both ways. 

Imagine a US citizen located in a state where they usually do not pay taxes or pay a small  

percentage: knowing that his seller fees will be calculated at 12% and will include the 13-15% taxes which a Canadian buyer would owe to the Canadian government, you think that the US seller would want to entertain buyers from Canada -Ontario and Quebec especially?

I think not and now I have a deeper understanding of those listings saying " does not ship to Canada". The translation is "I don't want to pay final values fees on your big taxes. "

I am of the opinion that if everyone would pay final values fees based on his own country's rules related to taxes it would be a more fair approach to the entire topic. 

[recped]

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@123.chemist wrote:

Imagine a US citizen located in a state where they usually do not pay taxes or pay a small  

percentage: knowing that his seller fees will be calculated at 12% and will include the 13-15% taxes which a Canadian buyer would owe to the Canadian government, you think that the US seller would want to entertain buyers from Canada -Ontario and Quebec especially?

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Easy to imagine given if you are a Canadian seller with buyers in Europe you (that's me) are paying fees on 20 - 25% VAT.

Of course I've raised my shipping prices (especially for multiple Items) to compensate and my overseas sales have declined (don't know how much is the increase and how much is the unreliable shipping due to Covid or the general decline that seems to be affecting buyers in ALL locations these days).

The biggest impact on buyers with this auto collection of taxes is on low value items that would previous pass through without any taxes. Buyers of items over the free limit (which are now gone in the EU/UK) are not so hard hit and may even like the new process because they no longer get hit with crazy high collection fees and extended customs delays when they buy from North America.

[pjcdn2005]

I think not and now I have a deeper understanding of those listings saying " does not ship to Canada". The translation is "I don't want to pay final values fees on your big taxes. "

Avoiding fees on tax is not why someone doesn't ship to Canada as ebay does not collect taxes for the  Canadian government.   The only time a tax is charged to a Canadian buyer is if the Canadian seller is registered to collect tax. In that case the Canadian seller would be be the one paying tax on the fees.  

In the case of the gst where ebay/Piteney Bowes collects 'import fees', sellers do not pay fees on that amount.

[leaky-bucket-labs]

Its robbery.

Charging me a fee on tax they collected then taxing me on that amount is racketeering.

complete BS

[byto253]

Backdoor fee increase. Nada you can do. Just look at the total fees and decide which items are worth selling on eBay.

[recped]

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@byto253 wrote:
Backdoor fee increase. Nada you can do. Just look at the total fees and decide which items are worth selling on eBay.

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When eBay started charging FVF on Sales Tax they collected (July 2020) they also reduced the FVF by .5% as compensation. The reduction covered the added Sales Tax fees up to 6.7%.

[mrdutch1001]

Call it what you like...The fees are on TOTAL transaction. PERIOD! ...and that's the way it is in business..

folks need to get over the fact that this is NOT "robbery", "fraud", illegal", " immoral" ,"unethical" and all the other name calling we have heard here...

it is what it is >accept, adapt, adjust, and carry on!

[sniper10000]

They collect Canadian taxes.

Sold for $675
I was charged based on $756 @ 12.9%
fee = $97.52
FVF= $0.30
then GST/HST of $12.72
Total $110.54

Any business collecting tax gets too keep a small % Not enough for Ebay they want more. Think Bestbuy could get away with charging 12.9% for collecting tax on a purchase? then taxing the fee for collecting tax? Selling to U.S.A worse because we pay still only tax doesnt benefit Canadian Citizens but wait they charge extra international fee of .4% too then charge Canadian taxes on feefor collecting U.S tax..... eBay has become a joke...we will collect tax with no additional fees Bull$h.t.

[sniper10000]

Yes fee for processing, not 13.3% fee for tax then charge tax on fee for tax. I get processing 2.9% not 13.3 then tax that. Any business would drop credit cards as they cant afford to cover that and stay open.

[marnotom!]

@sniper10000, the bulk of the posts on this thread are over a year old. This time last year, eBay was not required to collect and remit taxes on Canadian transactions made on the site.

It’s usually not a good idea to dredge up old threads as the information in them is often outdated or no longer relevant.

[reallynicestamps]

ZOMBIE THREAD FROM NOVEMBER 2021.

The problem with zombie threads is that the information and advice may be out of date and incorrect.

[reallynicestamps]

Any business collecting tax gets too keep a small %

This has not been true in Ontario for some 20 years.

[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.