You are paying the paypal fees on ebay's US sales tax!

[avionsunantiques]

As most will know, ebay is now required to collect sales tax in certain US states for items delivered to those states, regardless of where they are sent from.    ie, if you live in NY, and buy from Canada, your Ebay invoice will include NY sales tax.

That's fair enough.

The part that annoys me is we sellers are now paying paypal fees on the US sales tax collected by ebay!!!!!

Look at your paypal account for any item purchased by an US buyer in a US state for which ebay must now collect sales tax.

The tax is deposited into your paypal account as part of the total payment (item, shipping and tax). The tax is then instantly sent to ebay (ie it never really hits your account, it just looks like it does - ie you never have control or access to these funds - they are phantom funds)

However before these phantom tax dollars disappear from your account, paypal takes its percentage!

Now that I think it illegal.

Imagine if Paypal had a policy of putting $1000 into your account with every item purchase, then instantly removing the $1000 (ie using your account as a momentary accounting location entry for the $1000), and they charged you 3-4% of the $1000 every time.

That would be the same as stealing $30-40 from your account every time someone made a purchase.

This is apparently what paypal is doing with the US tax payments.

These payments are collected by Ebay, and have nothing to do with Canadains. However ebay has passed the paypal fees to Canadians by having the tax funds entered as an in and out accounting entry in your paypal account.

[femmefan1946]

Okay- that's your right.

But you do realize that you are not paying the sales tax? You are paying the PP fee on the sales tax.

If the item is $50 and sales tax is 5% or $2.50, the PP fee would be 3.4% of $2.45 or 8.5 cents.

 (I didn't count the 30 cent non-refundable fee because that would be there if there were no sales tax.)

On one sale that's negligible. On 100 sales, that's $8.50 extra cost (offset by the profits of those 100 sales.)

Naturally, Mr. Murphy being the jerk that he is, my first Internet Sales Tax sale was for $1500 and I paid over $3.00 to PP for the pleasure of paying eBay's bills.

Poot.

[ricarmic]

However, as you said, relative to the original price, it is not much. I would WELCOME 10 $1,500 sales this moment and be extra happy to have to lose the extra $30 the IST is costing me....