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eBay Opens Registration for Tax Exempt Buyers

Online Sales Tax
eBay Opens Registration for Tax Exempt Buyers

eBay began collecting sales tax from buyers located in certain states but has no way to accommodate buyers who are exempt from paying sales tax on their purchases – a problem that as we noted, could inhibit sales.

Today, eBay sent an email to buyers announcing they can now register their tax-exempt status, and it said it expected to have a solution in place this month. In the meantime, eBay will continue to charge them sales tax.

Here’s the text of the email eBay sent – we aren’t sure if it limited the distribution list to buyers located in states affected, such as Washington.

Announcement: Tax Exempt Business Registration Now Available

Dear Buyer,
As of January 1, 2019, eBay is required to calculate, collect, and remit sales tax on behalf of sellers for items shipped to customers. This law is in effect now in your state as one of the marketplace responsibility states within the US. Therefore, you will see applicable sales tax collected by eBay and included in your order total at checkout.

If you are a tax-exempt buyer (e.g., charitable entity, reseller, etc.), we’re currently creating a buyer exemption system that will allow you to submit tax exemption certificates to eBay and make purchases without paying tax. We expect this solution to be in place in March 2019.

Tax-exempt buyers.

In order to verify tax exemptions applicable to your business for purchases on eBay, we will be requiring you to share a Valid Exemption Certificate (acceptable file formats are .gif, .jpg, .jpeg, .pdf, and .png). You will be able to submit certificates via a Document Upload Link.

Please include the following information in the Comments section:

  • Full Name
  • Business Name
  • eBay ID

What can I do now before the eBay tax exempt solution is in place?

You may be able to get a credit for sales tax paid to eBay directly from your state. However, you should consult a tax advisor or contact the department of revenue for your state for further details as policies are different for each state.

See details and FAQs on paying tax on internet purchases.

Please note this email is sent from a mailbox that is not monitored. Send any documents via the link above.

See related stories:

eBay Seller Update 2019: Sales Tax Collection (March 6 EcommerceBytes Newsflash)

eBay Sales Tax Error? Washington Says Contact the Seller (February 12 EcommerceBytes Blog)

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.