Here's another Glitch with the new USA sales tax..

[esclyons]

When a buyer buys multiple items, the tax is showing up as a percentage due to their state, including shipping, but when i combine and lower shipping ..the tax stays the same, it recalculates the lower shipping but does not correct the sales tax..  This is the 3rd or 4th time this has happened.   can someone point tyler to this post...  and screen shots shouldn't be necessary as this happens every time a usa buyer  , buys more than one item.  All i am doing is lowering the shipping fee, because of multiple items. but the tax stays the same.  This could be a huge class action lawsuit if not  corrected shortly..  It will be easy for usa buyers to see they are being overcharged for tax, and it is not my fault..??

[esclyons]

[esclyons]

so first screen shot , shows shipping as 8$, and the sales tax.

then  second screen shot shows the shipping adjusted to 4$ for combined shipping, but the sales tax remains the same..

It is being overcharged..

[richardcm]

I read that some states charge sales tax on the items only and some charge the sales tax on both the items and the shipping cost. So perhaps you have had buyers in a state that only charges sales tax on the items only.

[richardcm]

I checked online and New York State charges sales tax on both items and shipping costs. Only for food items sales tax is not charged. So it does appear that there is an issue with sales tax when shipping is adjusted as in your examples.

[gwrocen]

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@esclyons wrote:

so first screen shot , shows shipping as 8$, and the sales tax.

then  second screen shot shows the shipping adjusted to 4$ for combined shipping, but the sales tax remains the same..

It is being overcharged..

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Not only is the buyer being overcharged but you as a seller

are having to pay more to PayPal.

It may be pennies on small sales but over time it adds up.

Maybe sellers who notice this should alert buyers to this tax overcharge. 

Let the buyers pursue this as well.

It is not right that Canadian sellers have to pay a fee to PayPal on money

that goes into the coffers of the American states. 

eBay will collect a commission for submitting the taxes to each state

so they get to improve their bottom line as well.  

I would think the amount will be substantial.

eBay should have its own PayPal account and should not be using

our PayPal accounts. 

[marnotom!]

Short and recent thread from the .com boards about this:

https://community.ebay.com/t5/Technical-Issues/To-much-Sales-Tax-When-Customers-are-Combining-Shippi...

I think this thread from January is about a similar problem, and the claim is that the buyer sees everything correctly on their end.

https://community.ebay.com/t5/Member-To-Member-Support/Erroneous-Internet-Sales-Tax-on-Invoice/qaq-p...

If that's the case, you should be charged PayPal fees on the correct amount, not the incorrect amount.  Can you do the number crunching to see if that's happening?

[silverpinups]

There is also extra work for the buyer when it comes to a partial refund from the seller via PayPal.

"If a partial refund is issued directly through the transaction on PayPal the sales tax is not automatically refunded. A buyer can work directly with CS to request a refund, or can claim a credit on their taxes when filing depending on the tax laws for their state". 

https://community.ebay.ca/t5/Seller-Central/SALES-TAX-amp-PAYPAL-REFUND/m-p/430648#M109890

[maximus7001]

I would look into it by recording what you see then ask the buyers what they see on their end.

[recped]

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@silverpinups wrote:

There is also extra work for the buyer when it comes to a partial refund from the seller via PayPal.

"If a partial refund is issued directly through the transaction on PayPal the sales tax is not automatically refunded. A buyer can work directly with CS to request a refund, or can claim a credit on their taxes when filing depending on the tax laws for their state". 

https://community.ebay.ca/t5/Seller-Central/SALES-TAX-amp-PAYPAL-REFUND/m-p/430648#M109890

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That is how it has always worked for Sales Tax (on eBay), I charge GST/HST to Canadian Buyers, when doing a partial refund it's up to the seller to adjust the sales tax (or not), there is no way for PayPal to do it on a partial. If you give a full refund then GST/HST is refunded in full.

I'm not sure what happens now with full refunds when there is US State Tax in the mix as these funds don't remain in your PayPal account.

[pjcdn2005]

On other threads that I've read about this, the reps said that the buyer will see the corrected tax amount on their end.

[recped]

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@pjcdn2005 wrote:

On other threads that I've read about this, the reps said that the buyer will see the corrected tax amount on their end.

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This is my understanding as well. The tax shown when you go to send an invoice is really just a placeholder since the actual sales tax due cannot be determined until the buyer goes through checkout and provides a shipping address.

While it's a bit "funky" I don't see how else it can be done especially as we now have a situation where for some transactions eBay collects Sales Tax while for others Sellers are still collecting sales tax (States without a MF law).

[pjcdn2005]

Sending an invoice 'freezes' any calculator functions so if the address is changed after the invoice is sent, the  calculator doesn't change the shipping amount.  So even if  ebay collected ALL states taxes, its possible that checkout would still work the same way for taxes as it does now.