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EcommerceBytes Soundoff: Letters to the Editor – January 12, 2020

Letters to the Editor column
EcommerceBytes Soundoff: Letters to the Editor January 2020

In every issue, readers soundoff about issues important to them. From shipping issues to payment processing, from fees to online marketplace policies, EcommerceBytes Soundoff gives you a chance to air your views.

Dear Ina,
I just made a sale on eBay, and I received the item price, plus roughly 7% in “tax” (sales tax, I would assume). The buyer was in Iowa. I am not licensed to collect Iowa tax, nor am I required to be. Upon checking in my eBay seller hub, I found that there was an announcement made by eBay just today about sales tax. In the message, they reference a prior message made on October 1. I remember that message. It was very difficult to understand, and I remember other sellers being equally confused.

Today’s message goes on to say:

“In states where eBay is required to collect Internet Sales Tax from buyers, order totals sent for processing will reflect the gross order amount inclusive of tax.

“Once settled, the tax amount will be automatically deducted for remittance to the applicable taxing authority.

“A record of the sales tax portion of the order will be available on the Seller Hub Order details page and through our Download order report.”

This is as confusing as the October message. What does “will reflect” mean? Does it just mean that there will be a notation of the tax? Or does it mean that the tax will (at least initially) be paid to the seller?

Based on my recent Iowa sale, it would seem to be the latter. What does “automatically deducted” mean? eBay is going to take the tax money back at some point? But at what point? And by what means? PayPal? And if so, what account (credit card, bank account, etc.)? The credit card on my eBay account? Or included on my monthly invoice? I have 6 credit cards and three bank accounts connected with PayPal.

I should not need to have enough money/credit to cover all sales tax payments in ALL of those accounts. However, without knowing when they payment will be “automatically deducted” and from which account, I need to do just that! To add insult to injury, I’m quite sure PayPal is going to take their 2.9% on the tax portion, but when eBay “automatically deducts”, they will “automatically deduct” the whole thing! At least when I (personally) was actually collecting and remitting sales tax to Pennsylvania, I got a 1% credit if I paid it early, which I always did. It didn’t fully cover the PayPal fee, but it was something. Now, eBay is likely getting that discount (at the very least, I will not be getting it), for states that I don’t even (personally) need to collect to.

Hi Ina,
Newegg changed return policy for 3rd party sellers, it is automatically processing returns for 3rd party sellers. Previously 3rd party sellers handled their returns and could have their own return policies.

According to the industry, returns make up about 10% of sales and seems to be a concern for retailers.

Imagine if we could return a new car within 90 days if we did not like, how many would be returns.

Note from the editor: Also see this letter about Newegg’s return policy on the Letters to the Editor blog.

Visit the Letters to the Editor blog for more letters from readers published recently.

Send your letter to the editor by emailing ina@auctionbytes.com with “Letters to the Editor” in the subject line (remember to include your name as you would like it to appear).

Ina Steiner on EmailIna Steiner on LinkedinIna Steiner on Twitter
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). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.