Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Tue Nov 10 2015 21:07:06

The Anti-eBay Sales Tax Bill?

By: Ina Steiner

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Does it make sense that an online merchant who makes sales of $10 million should be exempt from collecting online sales tax for out-of-state transactions while a seller on eBay who sells $1,000 worth of items should have to collect taxes on sales to customers in any and all states?

The Marketplace Fairness Act has failed to pass thus far, but a new bill, the Remote Transactions Parity Act of 2015 (RTPA) is slowly build momentum, according to eBay, "driven primarily by aggressive pleas from home state officials and brick and mortar retailers."

eBay calls the RTPA bill worse than the MFA, and Etsy is also against the bill.

Just because you sell online doesn't mean you're against the notion of online sales tax - many of you operate brick-and-mortar businesses as well as selling online. But disqualifying sellers who sell on "electronic marketplaces" from a small-business exemption  makes no sense and smacks of an agenda.

Could the RTPA be anything but devastating to small online sellers - and not just on eBay, but on Bonanza, Etsy, Amazon, eCrater, eBid, etc.?

We'll have more on this in Wednesday's issue (available here).




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Readers Comments

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Joey4711 This user has validated their user name.

Wed Nov 11 01:24:51 2015

Isn't it funny how Ebay suddenly cares about the small seller?  My as$$.....they do. They know if they have to charge sales tax that buyers will purchase less on the site which means less fees for them.

If it was really a story about little guy versus big box retailers than wonderful Donahoe wouldn't have made deals with the big behemoths and told the noise to shut the hell up and deal with it.  

Now, when it benefits them all of a sudden were important again.  You can't have it both ways.  Suddenly were to believe this venue cares about the little guy, when it spent the last five years selling the little guy down the river.

Mail a package USPS loses it defect, as that is your employee as you direct them and choose who you hire so you are responsible Ebay would say. Yet, they never said hey you pay us a monthly fee and don't show your listings, after all since you pay us we are your employee and as your employee we will now hide your damn listings, and more importantly we will pay Donahoe and others millions of dollars to stay with the company, but now this sales tax thing is terrible for small business, really?

It is a joke, ebay sales are up 5% but the average seller is down and in my view it comes down to giving search visibility to all the great big box stores they made contracts with to produce so much sales with.

Just today I had a person tell me take 50% off a competitively priced item and he would purchase it (this is the type of stupidity that Ebay pushes with best offer etc.).   I turned it around on the buyer and let him know that I just wish Ebays fees weren't so high as in this transaction Ebay takes $42.00 of your money in fees, but they tell you the marketplace is free and I just couldn't possibly give him that price with all the fees that Ebay and Paypal make.  I also let him know that if he sees this same item for 50% less and he doesn't want to buy it please let me know quickly as I will purchase it sight unseen.  Ebay buyers have been trained by Ebay to want something for little or nothing.

Sellers quit telling buyers fees, they don't understand or care. Tell them how much Ebay takes from the buyers money when they want discounts they will start to figure it out.

Anyhow Ebay can sink as far as I am concerned and I hope they pass the sales tax bill and wonderful Ebay will see a hit to their pockets but knowing how they have misbehaved and been immoral in my view in the past they will probably start taking 10% of the sales tax as commission and will sell it to you as a benefit.

Just like Google, they keep talking about the penalty of Google search, but they have done nothing to alleviate it, because they don't want to pay for search priority, but they also want to sell more and more. I guess Amazon who owns search on Google (spends lots of money on it) is just stupid, afterall it is always better to bet on Ebays track record than Amazons because if you purchased Amazons stock and didn't sell it you likely be rich, if you purchased wonderful Ebays you likely to be on food stamps in my view.

 

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: comet This user has validated their user name.

Wed Nov 11 02:14:20 2015

We need an UPVOTE button here Ina!!!!!

Thank you JOEY 4711

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: rachel This user has validated their user name.

Wed Nov 11 02:19:40 2015

Apparently this is how retailers want to get rid of non-big box venues. You will have to be very large to compete or even want to compete with collecting tax in the multitude of NY state tax per county or districts in California multiplied it by large states in large metro areas.You would have to be a Walmart to compete and since they already have a presence in most if not all states, they are already set up for this. For us who sell exclusively online, we will just do something else and that is proponents want for their home state retailers but not what eBay wants. Retail is coming back on its own just the ads and the requests for reviews and yada yada. You can't even peruse now they make you sign in so they can track your every movement or many do.

Actually this may be why eBay is now courting the used item segment and garage sale market again; maybe there will be a way to get another ''little old lady exemption'' so they are moving away from new products from smaller sellers, you know stuff people wear and use and want deals on, not things they collect and then have to get rid of when they have to downsize in old age, empty nest or divorce and find out that no one wants antiques anymore & mid-century modern is out, we are up to the 70s now...

If you have another income and just dabble it will work but they need a tons of dabblers... to make up for all those that will be leaving if this thing pans out. You can expect calls from Avelara the most annoying company with scare mongering tactics, aggressive sales goals I suppose, they are one of the worst  I have encountered for high pressure sales for years now cal about the day I will need to do this so sign up now!
So now maybe we can say that we are not 1099 but employees since we have to follow the rules of the employer...time to turn the tables on them so they treat us better...us loyal people that act like dogs..we are on a very short leash.

Maybe they will impose a floor and compromise ( yes I am talking about our Congress) and find a middle ground...dream on...

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: birdman This user has validated their user name.

Wed Nov 11 04:51:19 2015

I live in Great Britain. Does anyone know if this will affect me if I sell to the USA?

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Chicago48 This user has validated their user name.

Wed Nov 11 06:11:12 2015

Does this law effect the Chinese and external country sellers too?  If so, then we'll see them leave in droves - or buyers only buying items listed "from China" because they're exempt.

If I have to collect tax and then distribute it to the states, it's not worth my time to do sales.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

This user has validated their user name. by: bitbybit

Wed Nov 11 06:23:36 2015

I still don't see how any of this will pass since every state has a different tax. Food, clothing and various paper products in my state are not taxed and are exempt. Those supplementing their income by selling online and required to pay sales tax to other states may lose their small online business and have to turn to the state for support. States better be set for the onslaught of new constituents seeking assistance.

Selling online increased when manufacturing plants and corporations started and continued to outsource all the jobs in the USA.

It would be one thing if small sellers sold online AND had a B&M but to hang all online sellers out to dry is NOT a fair level playing field.

Take eBay, for example, ebay use to have a fair level playing field for all parties involved but now it is completely off-kilter but disguised in such a way to deceive the outside world into thinking everything is on the up and up.

Just think, if there are no jobs there is no money and with lack of money there will be fewer and fewer sales on or off line. I guess we will have to go back to bartering. Sellers can trade all their unsold & unseen items to other sellers in the same boat.

How many goats do you want for that boat?  

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Chicago48 This user has validated their user name.

Wed Nov 11 06:33:37 2015

@bitbybit - it will require that you get special software that calculates the tax from each state.

I'm writing my rep, my senator, Chaffetz (he's a putz) and Ryan.  Sending them letters NOW.  Does anyone know if there is an online petition we can sign?

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: sasikat9 This user has validated their user name.

Wed Nov 11 06:34:04 2015

I hardly think that having to charge a few more pennies because of an online tax is going to effect the sales of anyone at all. Be it online sellers or BM sellers.

Get real people. Buyers are to busy to wander a store for something or to lazy to get in the car an drive a few miles.

So much easier to buy online.

And will all the rental sites ie Amazon and Ebay what is there to worry about.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Chicago48 This user has validated their user name.

Wed Nov 11 06:41:12 2015

During the summer months I scour the rummages and yard sales, not just for goods to resell, but for things I can use like office supplies.  I go the flea markets and buy office supplies really cheap.  I can next see the BIG BOX stores demanding that flea markets and yard sellers charge tax to their customers - or even worse - pay tax to the States for selling in their back yards.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Chicago48 This user has validated their user name.

Wed Nov 11 06:47:24 2015

Rep Jason Chaffetz:  2236 Rayburn House Office Bldg., Washington DC 20515
Rep Paul Ryan: 1233 Longworth HOB
Washington, D.C. 20515

If the Chinese won't have to pay this tax, it only benefits them.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

This user has validated their user name. by: Rexford

Wed Nov 11 07:09:42 2015

If this were to pass, I can't wait to see how it is enforced.

Ina, please out the folks behind this bill. I didn't see any names associated with it.  They are no more than bullies picking on the little guys.

As usual, the poor and middle class bear the brunt of tax payments.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: an American in France This user has validated their user name.

Wed Nov 11 07:51:06 2015

If this bill passes (& I hope it doesn't), will sites such as eBay, Etsy, etc. build in software to calculate the tax, & keep that software updated as tax rates change? PayPal (or whatever forms of payment you use) is collecting the money, so will they forward the tax to the relevant government agency? I doubt it. Will the sales tax amount be subjected to eBay's final valuation fee & PayPal's fee? No doubt the fees would be applied to the sales tax, & small sellers will be penalized even more.

As has been said earlier, the state sales tax codes are complicated -- in some states, clothing is exempt, in others antiques/used items are exempt, & some states have no sales tax. Who will be responsible for figuring out all the variations for 50 states + territories such as American Samoa?

I sell on Etsy & Bonanza, & my husband sells on eBay. We are based in France & a large percentage of our sales are to the U.S.  As a non-U.S. seller, would I be liable for the sales tax?

I forsee a big mess ahead.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: ewegolf This user has validated their user name.

Wed Nov 11 07:58:39 2015

Why has Jason Chaffetz introduced the RTPA?  Jason Chaffetz, the self-promoting chairman of the House Oversight Committee.  One name.  Mike Jerman, who was Chaffetz's Legislative Director from 2009-2015.  Early this year Mike went to work for a Utah firm named Taxometry.  That firm describes itself as a "tax software company solving the challenges resulting from changes in requirements for online sales tax collection."  It is also working to being defined as a Certified Software Provider under the definitions included in the RTPA.

Lowering the exemption level to include any seller who sells on an electronic marketplace certainly creates an enhanced market for Taxometry et al to provide you with the mandated software to collect from nearly 10,000 different taxing agencies.

Blatant cronyism?  Your call.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

This user has validated their user name. by: Al G

Wed Nov 11 09:18:04 2015

@ewegolf

BINGO!!!!

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

This user has validated their user name. by: toolguy

Wed Nov 11 09:33:16 2015

@Joey4711

This isn't only a eBay thing, it's for ALL online sales!

If they implement it I'll quit selling online and move forward with my Cannacreme business. . .

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

This user has validated their user name. by: toolguy

Wed Nov 11 09:37:50 2015

Remember, it's not just the 50 states.

It's the counties in each state.
(some states don't have sales tax)

Orange County Ca. has a different sales tax then LA county Ca.

A nightmare in the works that I don't have time for.

I WON'T DO IT!

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: epuise This user has validated their user name.

Wed Nov 11 09:37:51 2015

I cannot afford to do any more tax prep than I do. I pay sales tax to my state, from sales to customers in my state. Any more work for me, I get rid of my merch., sell my small house, live in my van, and collect whatever freebies there still are. I am in my late 50's and have worked 7 days a week my whole life. Enough is enough. There is more to life than making the rich, richer...

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: spooky This user has validated their user name.

Wed Nov 11 09:39:04 2015

and while they're at it why not go after all the flea markets and yard sales? ridiculous! of course there should be a small timer exemption.  

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: FREDDY This user has validated their user name.

Wed Nov 11 09:44:54 2015

Chinese sellers will be exempt.

Glitch(ebay) is just a ''venue''.

I would also bet ebay would try to collect a FVF on the sales tax.

Perminate Link for The Anti-eBay Sales Tax Bill?   The Anti-eBay Sales Tax Bill?

by: Rosered This user has validated their user name.

Wed Nov 11 10:07:42 2015

@ Epuise.

The rich think. "Well I got mine" sucks to be you!

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