eBay are set to collect Internet Sales Tax on sellers’ behalf as the policy expands to more US states.
eBay announced yesterday in The eBay Community their commitment to support sellers affected by the June 2018 Supreme Court decision.
What does the ruling mean for eBay sellers?
Some US states have extended the tax collection obligation to marketplaces.
The policy affects sellers regardless of their physical location. This means if they sell in certain states, they may require to collect applicable taxes on transactions.
eBay say that they believe this ruling is unfair to small businesses. They promise to continue to find the best way to support and advocate for their sellers.
For those states that eBay are collecting tax, sellers do not need to take any action. There are no extra charges or fees for this service. Prior to these dates, sellers should continue to collect and remit tax in these states and comply with any other applicable requirements they impose.
There are no opt-outs for selling items to the states that eBay are collecting tax for, or out of eBay automatically collecting sales tax for applicable orders.
‘Additional states might be added’
eBay say that additional US states will likely to be added. They encourage sellers to stay informed on the help pages.
eBay have also added a buyer system for tax-exempt buyers (e.g. charitable entities, resellers etc.) that allows sellers to submit tax exemption certificates to eBay and make purchases without paying tax. Merchants can upload their tax exemption certificate here or visit eBay’s help pages for more details.
eBay recommends sellers to consult their tax advisors on the new tax requirements. Sellers can also contact eBay’s partners Avalara and TaxJar for specific insights into the best course of action them.
6 Responses
Makes sense due to the massive amounts of Chinese fraud. Really bad in USA because the market is huge. Supposed any domestic sellers left in America to be honest.
good will help stop vat/tax fraud should do it in UK
We have had US sales with 8.1% tax applied.
What is not clear is that do we need add a tax code, as with Australia ABN to the address labels to ensure the buyer is not double charged on import duty.
Since the online sales tax has been applied our sales to Australia have dried up completely. Where we were sending 12 or 15 parcels a month (antiques) we now haven’t sold so much as one item there in the past 4 months.
Either that’s a failure on our part, ebays part or sales tax implications. Sad really.
This is horible for small business. Now everyone is open to audits not only from the federal government and your own state but potentially 50 others.
My sales to the US and Australia have also dropped since the imposition of the Sales Taxes in those areas that have now enforced these taxes, which is a pity. Many items that I sold to these areas were previously good trading areas for my company. I can understand that this will become necessary for certain items, but books should really be exempt (as it is in many countries….), in my opinion, but then II am a professional book dealer.