Supreme Court overturns Quill, subjects all internet transactions to sales tax

[steve B]

Originally Posted by Exhibitman

No, that is incorrect. The sales tax system is self-reporting: the merchant calculates, collects and remits with a tax return the merchant prepares. The harder it is to calculate and track the more trouble it is for the merchant and the more likely the merchant will mess up and owe penalties and interest. Having to collect tax on interstate and intrastate sales will actually be a relief for some businesses because there will no longer be a need to keep track of as many forms of sales. Right now, they have to track sales by jurisdiction and make intra v inter state calculations.

Massachusetts requires reporting sales anywhere annually to monthly depending on sales. 1201 makes it monthly. The form is pretty simple, but at least when I had a resale number filing electronically was required. Nobody is required to file/pay earlier, but I think they're ok with getting paid more often.
In 2 years I had no in-state sales.

I was mostly kidding about the junk wax, I was picturing them trying to work out a few million individual .01 sales.

One of the places I used to go got in trouble - not a lot, but trouble- because they included the tax in the item price. Not bad if you've got 10 things at $1 back when the rate was 5%. But with odd amounts and rounding if you do that you collect more tax than you should.

[tschock]

One wonders....

Understood that as a resident of a state with a sales tax, it was always my obligation to report unpaid taxes from out-of-state purchases to the state, but it is now making all internet sellers (barring thresholds), as agents of the state, to now collect and supply those out-of-state taxes to the state. This will put undue burden more on small businesses rather than larger ones.

• As many sellers opt out of selling outside the US, will they now decide to opt out of selling to certain state residents (with overly burdensome/intricate regulations)?
  
• Will a new balance shift back to brick-and-mortar merchants for certain items? For example, would a Wilmington, DE B&M merchant have an unfair advantage for selling furniture since they don't have the same burden to even process paperwork for out-of-state buyers?

[barrysloate]

Every year I send $39 to Early American Coppers, an organization of large cent collectors, for my yearly dues. This week they sent me an invoice for $42.46. No, the rates didn't go up, but they did add $3.46 tax to my bill. Imagine paying sales tax on membership dues. My first experience with the new law.

[tschock]

Originally Posted by barrysloate

Every year I send $39 to Early American Coppers, an organization of large cent collectors, for my yearly dues. This week they sent me an invoice for $42.46. No, the rates didn't go up, but they did add $3.46 tax to my bill. Imagine paying sales tax on membership dues. My first experience with the new law.

Here's your second. In some states, dues and other services are subject to sales tax.

[barrysloate]

Originally Posted by tschock

Here's your second. In some states, dues and other services are subject to sales tax.

We'll soon find out who charges and who doesn't.

[Exhibitman]

Originally Posted by tschock

One wonders....

Understood that as a resident of a state with a sales tax, it was always my obligation to report unpaid taxes from out-of-state purchases to the state, but it is now making all internet sellers (barring thresholds), as agents of the state, to now collect and supply those out-of-state taxes to the state. This will put undue burden more on small businesses rather than larger ones.

I disagree. As a small business owner I already am registered with the state for sales and use tax reporting. I am already required to collect, report and remit sales/use tax. As it stands right now I have to track different types of sales. It will be easier just to slap a tax on every sale than to differentiate intrastate and interstate sales. My tax return just got a lot simpler. Or it will once the states react to the ruling and rejigger their rules, forms and practices to meet the new standard.

[BobC]

Originally Posted by barrysloate

every year i send $39 to early american coppers, an organization of large cent collectors, for my yearly dues. This week they sent me an invoice for $42.46. No, the rates didn't go up, but they did add $3.46 tax to my bill. Imagine paying sales tax on membership dues. My first experience with the new law.

And it is not just rates for sales tax that may vary by state and jurisdiction, each states has different rules and things they may tax for sales tax purposes, like dues in the state in Barry resides in.

I'm in Ohio and sales tax here is also on things like snow removal, exterminator services, physical fitness facility services, laundry and dry cleanings service, etc. The one fairly constant though among all states collecting sales tax is that it is collected on the sale of tangible personnel property to final users/consumers. In other words, baseball cards you buy as a collector are always going to be subject to sales tax. If you buy cards as a dealer and intend to resell them, your purchase would then not be subject to sales tax but, you would instead have to charge sales tax to whomever you sell those cards to, unless it is also another dealer going to resell them.

I've heard of people that will print off a sales tax exemption certificate from online and fill it out and then give it to an auction house or dealer they are buying cards from so as not to have to pay the sales tax by claiming they are a dealer themselves and going to resell the cards. Good luck if they ever get caught.

[BobC]

Originally Posted by PowderedH2O

It seems as though it would have to be based upon the seller's location. How much of Wayfair's sales would be in South Dakota? SD would want a piece of the pie for the sales going out of the state I would think.

Sales tax is normally based on where the actual sale takes place. If it is at an actual brick and mortar store, that is the location used for the sale and to determine the sales tax on, even if the person doing the buying is from another state or country. This is exactly why states will work together and police businesses across the borders from one another, so people from one state don't cross the state line to buy something like furniture from a business in the next state that isn't responsible to collect and remit the sales tax from the neighboring state the buyers are from. To get around the sales tax, the people would have the purchase shipped to them in their state and not pick it up at the store location because doing so would make them subject to paying the sales tax in the neighboring state where the store is actually located.

When it comes to sales transacted over the internet and by mail/delivery service, the sale is considered to tax place and be subject to the sales tax at the point where the buyer takes delivery and acquires the goods. In other words, at the house/location the purchased items are shipped to. So sales from Wayfair going to locations outside South Dakota are not generally going to be subject to SD sales tax.

[tschock]

Originally Posted by Exhibitman

I disagree. As a small business owner I already am registered with the state for sales and use tax reporting. I am already required to collect, report and remit sales/use tax. As it stands right now I have to track different types of sales. It will be easier just to slap a tax on every sale than to differentiate intrastate and interstate sales. My tax return just got a lot simpler. Or it will once the states react to the ruling and rejigger their rules, forms and practices to meet the new standard.

Sincerely confused by this response. You said THE state. What about other states with different rates? I guess the bottom line is we have to wait and see what the changes will be. Though rather than simplify things, it seems the government tends to generally make things more complicated than need be.

[BobC]

Originally Posted by rats60

I don't see that ever happening. Why would EBay want to destroy their business? Why would they want to take on an unnecessary burden? If they force all sellers to charge sales tax when 90%+ don't need to, most of those sellers will leave. I collect sales tax on sales within my state and send it to them. In the unlikely event I need to do it for other states I will. I will not charge people sales tax on items they don't need to pay it on.

This decision is aimed at large resellers like Warfare, who hurt small business by not charging sales tax and states who have seen revenue decrease because of large online retailers. It is not aimed at trying to collect on every single sale, even if it is an individual selling an used item that they no longer have need of.

This is not technically aimed at Ebay since they are only a platform used by seller's to create a marketplace for selling their goods online. The burden for actual sales tax collection, reporting and remittance is on the actual sellers who own and sell their inventory. Someone like Wayfair is the actual seller themselves so they are charged with having to collect and report the sales tax. What Ebay is likely concerned about is that even if they are not technically responsible for collecting the sales tax, they do have records and data concerning all the sales transactions and buyer and seller data that the various states would come after and start demanding from them to enforce their various state sales tax laws. And as soon as people selling on Ebay realize their information may be getting reported to the states, they may decide to drop off Ebay and look to sell on other sites and venues where the states may not be looking so strongly at yet, or just quit selling altogether as they don't want to deal with the hassle. Because of the added work and such involved, it could end up costing Ebay business down the road, and thus it makes sense that they would try to fight this up front.

Also, I'm not sure that Ebay could specifically force sellers to use software created by them to calculate and collect sales tax. By doing so it may end up looking like they are admitting to the states that they actually are responsible for the sales and collections of sales taxes, which they definitely do not want to do.

[BobC]

Originally Posted by tschock

Sincerely confused by this response. You said THE state. What about other states with different rates? I guess the bottom line is we have to wait and see what the changes will be. Though rather than simplify things, it seems the government tends to generally make things more complicated than need be.

What Adam is likely referring to is that he is currently registered and licensed to collect and remit sales tax in the state in which he and his business reside. So if he had sales to customers in his home state where he is located and has nexus, he properly collects the sales tax and sends it in. Under the prior law, sales to a customer outside of his home state where he does not have nexus and is not required to be licensed and registered for that other states' sales tax, he would not charge and collect sales tax. That would be the responsibility of the buyer to report and pay the use tax to their home state of residence.

That is the problem with this recent ruling. In the future Adam may be forced to start registering and filing sales tax returns in other states merely because he reaches a certain level of business (sales) to customers in those other states. And he would then have to start keeping additional records and such to comply.

If this does go through and leads to the potential impact many fear, I can see that some software company(ies) will take advantage and try to create a program to assist small business owners in filing and complying with the various sales tax laws in all the states they have sales in. At some cost of course. And then market providers like Ebay would become hard pressed to interact with such other software to help their sellers, or have to develop it themselves. Whatever way it would end up going, it is not something Ebay wanted to have to deal with I would guess.

[tschock]

Originally Posted by BobC

What Adam is likely referring to is that he is currently registered and licensed to collect and remit sales tax in the state in which he and his business reside. So if he had sales to customers in his home state where he is located and has nexus, he properly collects the sales tax and sends it in. Under the prior law, sales to a customer outside of his home state where he does not have nexus and is not required to be licensed and registered for that other states' sales tax, he would not charge and collect sales tax. That would be the responsibility of the buyer to report and pay the use tax to their home state of residence.

That is the problem with this recent ruling. In the future Adam may be forced to start registering and filing sales tax returns in other states merely because he reaches a certain level of business (sales) to customers in those other states. And he would then have to start keeping additional records and such to comply.

If this does go through and leads to the potential impact many fear, I can see that some software company(ies) will take advantage and try to create a program to assist small business owners in filing and complying with the various sales tax laws in all the states they have sales in. At some cost of course. And then market providers like Ebay would become hard pressed to interact with such other software to help their sellers, or have to develop it themselves. Whatever way it would end up going, it is not something Ebay wanted to have to deal with I would guess.

OK. I believe he disagreed with my statement "This will put undue burden more on small businesses rather than larger ones." (but will have to let him respond). But I believe I see now where this coming from.

I think what you are saying is that this new 'mess' might be addressed by someone creating software to handle it (or possibly a coordinated effort to make this 'simpler' for businesses to handle). I can buy that as a possibility, but I would still have a 'wait and see' attitude regardless. Does Turbo Tax make filing taxes simpler? Yes. Does the (generally speaking) government action necessitate the reason for something like Turbo Tax in the first place? That proof is left to the student.

[tschock]

Originally Posted by BobC

This is not technically aimed at Ebay since they are only a platform used by seller's to create a marketplace for selling their goods online. The burden for actual sales tax collection, reporting and remittance is on the actual sellers who own and sell their inventory....

First, not disagreeing with anything you are saying. But the other thing to keep in mind is who has the deep pockets. Not you or I, but eBay. While the burden at this time might be on the seller, it might not be in the future. There's a fine line that could be blurred or shifted if there's easier money to be made collected. Auction houses collect taxes, though they are a consignor and don't actually 'own' the goods they 'sell'. Who's to say that burden might not be put on 'marketplaces' in the future. I'm not arguing with what the law currently is here, but speculating as to what it could become.

[BobC]

Originally Posted by tschock

OK. I believe he disagreed with my statement "This will put undue burden more on small businesses rather than larger ones." (but will have to let him respond). But I believe I see now where this coming from.

I think what you are saying is that this new 'mess' might be addressed by someone creating software to handle it (or possibly a coordinated effort to make this 'simpler' for businesses to handle). I can buy that as a possibility, but I would still have a 'wait and see' attitude regardless. Does Turbo Tax make filing taxes simpler? Yes. Does the (generally speaking) government action necessitate the reason for something like Turbo Tax in the first place? That proof is left to the student.

Turbo Tax is basically for income taxes, not for sales and use taxes. Usually the individual companies/sellers have to keep track of their sales tax collections and such themselves, and the various business software products they use will assist them in the calculation and billing and record keeping for sales taxes purposes. But they are still usually responsible for the filing and remittance of the sales tax returns themselves. Not sure there is a software out there right now that can also file for you in every state. I know for example that some states, like Ohio, have their own website that requires you to go onto their platform and site to report and pay your sales tax. They don't allow you to file and pay any other way.

If this new change to the law goes through and makes it where more sellers are now going to be responsible for collecting and remitting multi-state sales taxes, that may increase the number of users of such software to the point someone will figure they can now make money off it and develop such a product.

[Batpig]

Just as an FYI since it has been mentioned several times in the thread - 3rd party sales and use tax management already exists. I'm aware of Vertex, and I'm sure there are others.

[BobC]

Originally Posted by tschock

First, not disagreeing with anything you are saying. But the other thing to keep in mind is who has the deep pockets. Not you or I, but eBay. While the burden at this time might be on the seller, it might not be in the future. There's a fine line that could be blurred or shifted if there's easier money to be made collected. Auction houses collect taxes, though they are a consignor and don't actually 'own' the goods they 'sell'. Who's to say that burden might not be put on 'marketplaces' in the future. I'm not arguing with what the law currently is here, but speculating as to what it could become.

Understand exactly what you are saying but, this is the fine line that Ebay is trying to straddle. Whereas an auction house runs an auction on behalf of their consignors who sign an agreement with them to basically act as an agent on the consignor's behalf, Ebay does no such thing, and does not ever take possession of the items being sold on its site, nor become responsible for the shipment of goods and receipt of the payment. in fact, it is because of these latest occurrences that Ebay may have been looking ahead to these types of sales tax law changes that prompted them to make the decision to spin-off and divest themselves of Paypal a few years ago, so they could not be considered as responsible for collecting monies directly from buyers and make it less likely they could ultimately be held responsible for collecting sales tax.

Not sure it is a completely accurate analogy but, Ebay is like the flea market operator who rents spaces to sellers who come to sell their stuff to an audience that shows up because they know all these sellers are going to be there. The flea market operator is not the owner of the goods, does not deliver the goods or collect the money for them, does not act as an agent for the sellers, and definitely is not responsible for any sales taxes.

If the flea market gets big enough that someone at the state level knows about it, they could send an agent down to check on the sellers to see if they are properly collecting sales tax, etc. Now the flea market owner may not be responsible for the sales tax themselves but, say he/she does collect addresses and other info on all the sellers who show up so, the state agent makes a "friendly" request that the flea market operator provide all the pertinent seller info so the state can check up on the sellers. Once word of that gets out, how soon do you think it would be for sellers to stop going to that flea market so they don't get looked at by the state? This is how Ebay could take a hit and another reason why they were likely putting out that petition they were asking all the sellers to sign a couple months or so ago, fighting this recent ruling. Ebay is probably figuring that even if they don't have to directly do anything with this new sales tax enforcement, they still get hit with it because they are so big and already have so much information on everyone that the taxing authorities could simply request all the data and scare away sellers who don't want to get reported to the government.

To use another, maybe poor, analogy, think of the sellers as cockroaches. What do they do when you enter a room they're in and turn on the lights!!!

[BobC]

Originally Posted by Batpig

Just as an FYI since it has been mentioned several times in the thread - 3rd party sales and use tax management already exists. I'm aware of Vertex, and I'm sure there are others.

I'm aware of it and other sales tax management software also but, in this case the trick is, does that software currently interface with a seller's Ebay account so they don't have to go through all the time and effort to gather and keep track of all the sales tax data themselves and enter into the Vertex software by hand to then be able to file and pay all the various state taxes they end up owing? Software like that will not be cheap, and will need to be constantly updated and revised as sales tax laws and rates change over time. And what about if they also sell at shows or have their own site they sell from? Aren't they going to have to record all that data and possible enter it into the tax management software by hand themselves?

Also, that software simply manages the data and information, and may or may not actually be able to prepare and file actual sales tax returns for you in every state, or properly remit the sales taxes in an electronic or other automated manner. And then as was alluded to by some other posters, there is also the matter of having to look at each state you sell in and checking their rules and nexus limits.

And then a seller is going to have to register or license themselves in each and every state they end up being responsible for sales taxes in. The software isn't going to do that for you. And don't forget that all those various states have separate and different rules and rates and you still have to comply with their separate laws, etc. And let's say you decide to take a break and not sell for a while, in most states you're still going to have to file sales tax returns, even if the tax due is $0. And if you decide to quit selling, then you're going to have to formally go and dissolve or terminate your license or registry in all those states so they don;t keep coming after you for sales tax returns and taxes.

Additionally, I'm not so sure Ebay would like to share their source code with someone to write such a program to interface with their software, at least not if they didn't own the software themselves. And as earlier poster previously speculated, figure out a way to then charge for the cost of doing so. Of course, this then may present an added dilemma to Ebay as I pointed out in my previous post in regards to Ebay not wanting to do things that could potentially make them responsible for the sales tax themselves. If they create/sponsor such software, and especially if they charge sellers for its use, they may add to the risk of them being viewed as directly responsible for the sales taxes themselves by the states as well.

And also, by creating/owning/selling/charging for such software, they could become liable for interest and penalties on screw-ups and bad or missed sales tax filings or payments if there are errors or mistakes made by the software, among other things I extremely doubt that Ebay would in any way want to become part of the tax software and compliance business and add that risk and liability to their plate.

[Exhibitman]

I am sure all of this is going to be addressed in legislation in Congress.

But seriously, I think this will open the door to serious consideration of a Federal sales tax and the creation of a Federal-state partnership on sales taxes for interstate sales. Congress certainly could enact a uniform set of sales tax provisions and rules for interstate commerce, which would ideally allow a retailer in one state to enter all data for all interstate sales into a single Federal sales tax return and leave it to the agency administering the program to apportion the money and distribute it to all of the states.

I would also guess that most states are going to address this case in the next legislative session. Until the state laws are changed, there is nothing to do, really. The ruling just opens the door to future changes in the tax programs.

[savedfrommyspokes]

Originally Posted by BobC

in fact, it is because of these latest occurrences that Ebay may have been looking ahead to these types of sales tax law changes that prompted them to make the decision to spin-off and divest themselves of Paypal a few years ago, so they could not be considered as responsible for collecting monies directly from buyers and make it less likely they could ultimately be held responsible for collecting sales tax.

My understanding is that ebay will begin using another company to assist in handling their customer's payments once they complete their split from paypal.

http://money.cnn.com/2018/02/01/tech...yen/index.html

Based on this article, it appears ebay may become more involved with accepting payments than they were when they actually owned paypal up through 2015.

[BobC]

Originally Posted by Exhibitman

I am sure all of this is going to be addressed in legislation in Congress.

But seriously, I think this will open the door to serious consideration of a Federal sales tax and the creation of a Federal-state partnership on sales taxes for interstate sales. Congress certainly could enact a uniform set of sales tax provisions and rules for interstate commerce, which would ideally allow a retailer in one state to enter all data for all interstate sales into a single Federal sales tax return and leave it to the agency administering the program to apportion the money and distribute it to all of the states.

I would also guess that most states are going to address this case in the next legislative session. Until the state laws are changed, there is nothing to do, really. The ruling just opens the door to future changes in the tax programs.

Oh, that has been talked about for a while but, the problem as pointed out before, all the different state rules, taxes and rates in effect. Normally when you get the feds involved they try/want to set it up as one set of rules for all, to make it more simple and easier to handle. Also, what do you do for those states that don't have a sales tax?

Trust me, while it sounds like a good idea at first, many states will end up fighting this tooth and nail. A good example would be if you look at Ohio, which has virtually every city and village in the state with their own city income tax. The state has been trying to take that over and regulate and collect it on behalf of the cities for quite a few years now. The cities have been fighting it all along as they figure once the state handles it, they are now at their mercy. Same thing will hold true with the states allowing the feds to handle and collect this for them. They don't trust the feds at all either, and rightly so. Just like the cities in Ohio know not to trust the state.

[BobC]

Originally Posted by savedfrommyspokes

My understanding is that ebay will begin using another company to assist in handling their customer's payments once they complete their split from paypal.

http://money.cnn.com/2018/02/01/tech...yen/index.html

Based on this article, it appears ebay may become more involved with accepting payments than they were when they actually owned paypal up through 2015.

The trick here is that Ebay USED to own Paypal. As the owner of the company that was handling the collection and payments, it meant that Ebay was effectively handling all the payments and collections. Splitting Paypal off meant it was now being handled by a completely separate company so Ebay no longer had direct control in the handling of payments and receipts. The same disconnect will occur with this new Dutch company. They are not owned or controlled by Ebay, so once again, Ebay is effectively not collecting receipts or remitting payments. I believe from the article you read that the control they are referring to is in what functions and uses the new Dutch firm will set up specifically for Ebay and their users. As the article noted, even though Ebay is a big percentage of Paypal's business, it is still only 13% as of late. So the things Ebay may have wanted Paypal to do may not make sense to Paypal, and thus they may have turned them down. Don't know that for certain but, that could likely be another reason Ebay ended up looking elsewhere for online payment support from someone willing to tailor the software to what Ebay wants but, still not have Ebay directly own it so they could be considered as directly directly collecting and paying receipts and remittances.

Like I said earlier when someone else tried to suggest that Ebay was like an auction house. I pointed out all the differences and why the auction house was responsible for having to charge, collect and remit sales taxes. Ebay is looking to not have any of the same responsibilities as an auction house so they can not be held accountable, responsible or liable for collecting and remitting sales taxes. They just want to be the platform used by others to buy/sell online.

[savedfrommyspokes]

Originally Posted by BobC

The trick here is that Ebay USED to own Paypal. As the owner of the company that was handling the collection and payments, it meant that Ebay was effectively handling all the payments and collections. Splitting Paypal off meant it was now being handled by a completely separate company so Ebay no longer had direct control in the handling of payments and receipts. The same disconnect will occur with this new Dutch company. They are not owned or controlled by Ebay, so once again, Ebay is effectively not collecting receipts or remitting payments. I believe from the article you read that the control they are referring to is in what functions and uses the new Dutch firm will set up specifically for Ebay and their users. As the article noted, even though Ebay is a big percentage of Paypal's business, it is still only 13% as of late. So the things Ebay may have wanted Paypal to do may not make sense to Paypal, and thus they may have turned them down. Don't know that for certain but, that could likely be another reason Ebay ended up looking elsewhere for online payment support from someone willing to tailor the software to what Ebay wants but, still not have Ebay directly own it so they could be considered as directly directly collecting and paying receipts and remittances.

Like I said earlier when someone else tried to suggest that Ebay was like an auction house. I pointed out all the differences and why the auction house was responsible for having to charge, collect and remit sales taxes. Ebay is looking to not have any of the same responsibilities as an auction house so they can not be held accountable, responsible or liable for collecting and remitting sales taxes. They just want to be the platform used by others to buy/sell online.

My belief is that the reason ebay sold off paypal several years back had little to do with today's sales tax situation. It likely had more to do with ebay capitalizing on their "investment" in paypal.

Even today, paypal is not required to complete sales on ebay and payments (via CC) can be processed directly through eBay's software. I know, I have done it twice now in the past few months.

Based on the article, ebay is looking to become more involved (translates to making more money) on processing payments, as this will generate additional income for them(that PP is currently receiving). In other words, ebay is no longer using PP and switching to this new payments processing company because they will get more of a cut of each payment than they were from PP.

Likely, the changing of payment processors by ebay has nothing to do with this evolving sales tax situation.

[Lorewalker]

Originally Posted by savedfrommyspokes

Based on the article, ebay is looking to become more involved (translates to making more money) on processing payments, as this will generate additional income for them(that PP is currently receiving). In other words, ebay is no longer using PP and switching to this new payments processing company because they will get more of a cut of each payment than they were from PP.

I think the main reason ebay is going back to processing payments in house is in an effort to prevent buyers and sellers from having one another's email addresses. They are losing a good deal of revenue for sales being conducted outside of the website.

[BobC]

Originally Posted by savedfrommyspokes

My belief is that the reason ebay sold off paypal several years back had little to do with today's sales tax situation. It likely had more to do with ebay capitalizing on their "investment" in paypal.

Even today, paypal is not required to complete sales on ebay and payments (via CC) can be processed directly through eBay's software. I know, I have done it twice now in the past few months.

Based on the article, ebay is looking to become more involved (translates to making more money) on processing payments, as this will generate additional income for them(that PP is currently receiving). In other words, ebay is no longer using PP and switching to this new payments processing company because they will get more of a cut of each payment than they were from PP.

Likely, the changing of payment processors by ebay has nothing to do with this evolving sales tax situation.

I never stated the sales tax situation was the sole reason they sold Paypal, but i still think it may have been one of the original reasons and a contributing factor. Think about it, if the main reason they are dumping Paypal now is because they can get a bigger slice of the fee for handling the transactions and/or to also control the information between buyers and sellers more than ever so they can't easily get in touch with each other, why didn't they just keep Paypal in the first place? They could have made whatever changes they wanted to the Paypal software, and since they owned it, they would get 100% of the revenue from handling the transactions. And you may also be correct in that another reason or contributing factor for the selling off of Paypal was to take advantage of their investment and cash out when they thought it was to their advantage. Seeing as how Paypal has continued to grow though, and how nominal Ebay's percentage of Paypal's business has shrunk to, if maximizing their investment return was the main original reason for selling Paypal in the first place, they're likely kicking themselves about it now with the way Paypal has continued to grow. It is up over 50% in the last year alone.

I'm sure there are other good reasons as well but, still believe Ebay disassociating themselves from the direct ownership of the payment handling/processing company was also being thought about in terms of how to keep them from appearing to be more directly responsible for sales and collections and possibly make them liable for tax and other reporting purposes. Sales tax and other tax compliance/responsibility issues is probably one of the reasons, not necessarily the sole or main reason, that Ebay divested themselves of Paypal several years back. I am aware that Paypal is not the sole payment option and that Ebay can process credit card payments and such but, with Payal being the main payment processor on Ebay, and Ebay not directly owning them, it helps in the appearance and fact that Ebay does not have complete control of the payments processing function, which helps them defend themselves should some taxing authority try to make a claim that they are directly responsible for all collections and payment processing themselves.

I agree with you that the fact that they are looking to now change payment processors for a bigger piece of the fee has got nothing to do with the sales tax issue. I was referring back to when they originally divested themselves of the ownership of Paypal. And now that Paypal is a separate company, they don't have to do what Ebay necessarily wants nor pay them what they think they deserve for their part of the business. Even with the known fact in the marketplace that Ebay is replacing Paypal in the near future, Paypal is still doing great on the stock market. So much for them needing Ebay!

[BobC]

Originally Posted by Lorewalker

I think the main reason ebay is going back to processing payments in house is in an effort to prevent buyers and sellers from having one another's email addresses. They are losing a good deal of revenue for sales being conducted outside of the website.

Which is also another big reason Ebay has been fighting this sales tax compliance issue. Because they are so well known and big, the states will focus on sites like Ebay, and therefore on those sellers that use Ebay as a marketplace. In an effort to not have to keep all the records and charge customers for sales tax (which will likely reduce what people will be willing to pay for their items to begin with, much like buyer's premiums affect bids at an auction house), sellers will likely start looking even harder for other venues and ways to get around dealing with sellers through Ebay, which in turn reduces business for Ebay.

[Exhibitman]

Originally Posted by BobC

Oh, that has been talked about for a while but, the problem as pointed out before, all the different state rules, taxes and rates in effect. Normally when you get the feds involved they try/want to set it up as one set of rules for all, to make it more simple and easier to handle. Also, what do you do for those states that don't have a sales tax?

Trust me, while it sounds like a good idea at first, many states will end up fighting this tooth and nail. A good example would be if you look at Ohio, which has virtually every city and village in the state with their own city income tax. The state has been trying to take that over and regulate and collect it on behalf of the cities for quite a few years now. The cities have been fighting it all along as they figure once the state handles it, they are now at their mercy. Same thing will hold true with the states allowing the feds to handle and collect this for them. They don't trust the feds at all either, and rightly so. Just like the cities in Ohio know not to trust the state.

If the states enact a hodge-podge of new regulations over interstate sales tax and there is wide variance between them, that is precisely what the commerce clause of the Constitution was meant to allow Congress to regulate. The business lobby will go apeshit and in this pay-for-play government, if the money goes crazy, the officials they bribe, er, donate to, will respond.

[BobC]

Originally Posted by Exhibitman

If the states enact a hodge-podge of new regulations over interstate sales tax and there is wide variance between them, that is precisely what the commerce clause of the Constitution was meant to allow Congress to regulate. The business lobby will go apeshit and in this pay-for-play government, if the money goes crazy, the officials they bribe, er, donate to, will respond.

Exactly right. This is not an easy fix. The problem stems from the way the old laws requiring physical presence to be in place before someone could be responsible for having to file and pay any kind of taxes in any state or jurisdiction. Back then there was no internet or online sales. The did have catalogs sales but, not to the extent or volume of today's economy. And because of the vast increase in such internet and online sales, old brick and mortar businesses are shutting shut down left and right, or having a real hard time competing, states lose out on sales tax and other tax revenue they would have otherwise had, and on and on. They're now trying to figure out how best to update and change the tax laws to deal with the new way businesses are run and operate. The problem is that everyone is pretty much ingrained with the old, existing tax systems and rules, and to just wholesale change them all at once would create pure chaos in the business world and the economy. And in the meantime, since not every state has the exact same types of taxes, laws and rates, it is near impossible to hope for any concerted effort on the entire country's part to address this, unless as you suggested, Congress and the federal government take the lead. Of course, the states will never go along with this as it violates their states rights and they'll never all agree on exactly how it things should be handled, and who should be handling them, anyway.

As a supporting example, for years, there has been a group of states that have gotten together to back and support and promote ideas revolving around the generalization of state taxes and such, and it is all as a result of what is known as the Multi-state Tax Compact that was actually put into effect all the back in 1967. Been that long and they still can't get all the states to work together to agree on how to do things from back then even. Fat chance you'll get them to change their ways and start agreeing on all the new things happening every day now.

[BobC]

Thought this might be of interest to some of you regarding a follow-up to the recent Supreme Court case involving Wayfair in South Dakota. Here's a link to a recent article in accountingToday that talks about the possible ramifications of the ruling and potential reactions from other states going forward.

https://www.accountingtoday.com/news...les-of-wayfair

The interesting thing here to note is that under this Remote Seller's Law, originally enacted by South Dakota and effective back on May 1, 2016, is that their threshold and definition of a large online retailer/seller is anyone with more than $100,000 in sales to South Dakota residents/businesses in a current or prior year OR 200 or more transactions with residents/businesses in a current or prior year. Hitting $100K in sales may be a little tough for smaller sellers but, having over 200 transactions may not be so tough, especially for anyone selling a lot of smaller value cards. This puts outfits like PWCC and Probstein right in their cross hairs as 200 transactions a year only amounts to about 16-17 sales a month, which is really not that many and will likely impact quite a few sellers on Ebay.

Also, this recent Supreme Court ruling is not the final action. The case actually went back to South Dakota courts then for final resolution, so the actual law has not yet officially been put into full effect yet and still has to get over some additional constitutional hurdles. Here's another article talking about the history of this and where it now stands. Still, this should start being enforced sooner than later I would think as the South Dakota courts had already aligned with the state on the legality of this. Thankfully it sounded like South Dakota was only going to enforce this going forward, and not put any added burden on businesses by trying to make the law retroactive as trying to go back and collect sales tax after the fact is virtually impossible in my opinion.

https://www.salestaxinstitute.com/re...constitutional

Another interesting question is what exactly counts as a "transaction" towards the 200 per year threshold. If someone buys from a catalog or off a website from a seller like say Kit Young or Wayne Varner, i would think the total number of things they purchased at the same time would be bundled and sold altogether as one transaction. However, if such a seller also sells items on Ebay, which I'm pretty sure both of these guys I mentioned do, I'm not sure if each individual listing being sold on Ebay would be considered as a separate transaction or not, even if someone purchased several items all at once and then bundled and paid for them through checkout in one payment. I'm guessing that is something the South Dakota sales tax department will have yet to determine and opine on.

Also, sellers have to remember that if they sell through catalogs, websites, Ebay, or via other means, the $100K and 200 transaction thresholds are for total sales and activity through all those venues added together, not just Ebay sales and transactions. Ebay sales and transactions are probably the most visible and easiest for the states to go look at though, which is another reason Ebay is very unhappy about this because they are so big and visible to the states. Sellers trying to get around this may just reduce their activity on Ebay, or get off it entirely, so South Dakota doesn't come looking for them. Ebay knows this will likely have some negative impact for them going forward, just how much, no one knows yet. Also, it will possibly put Ebay in the middle if the South Dakota sales tax department comes asking them for information on sales into their state, or detail on seller's activity such as sales amounts or the number of transactions with SD residents/businesses. They won't have much of a choice and will likely have to comply with any such requests, so this will probably cost them additional time and effort as well.

This could become real interesting, and not necessarily in a good way!!!

[BosseFieldBoy]

I got a notice from Heritage that they will be including sales tax effective 8/1. Has anyone received a similar notice from any of the other auction houses?

[bobbyw8469]

I have never understood how you can pay sales tax on a USED item where the sales tax was already collected at the time the item was sold.

[Throttlesteer]

For the record, State and Federal tax revenues are at all time highs. Government can sing a sad song about losing revenue to internet transactions. The bottom line is, they have more money than ever.

[BobC]

Originally Posted by Throttlesteer

For the record, State and Federal tax revenues are at all time highs. Government can sing a sad song about losing revenue to internet transactions. The bottom line is, they have more money than ever.

Yes, but the cost of everything those taxes pay for is also likely at all time highs as well. I don't like paying taxes anymore than anyone else does, it is just a fact as well that most things cost more today than they did 10, 15 , 20+ years ago, and so on.

[steve B]

Originally Posted by BobC

Thought this might be of interest to some of you regarding a follow-up to the recent Supreme Court case involving Wayfair in South Dakota. Here's a link to a recent article in accountingToday that talks about the possible ramifications of the ruling and potential reactions from other states going forward.

https://www.accountingtoday.com/news...les-of-wayfair

The interesting thing here to note is that under this Remote Seller's Law, originally enacted by South Dakota and effective back on May 1, 2016, is that their threshold and definition of a large online retailer/seller is anyone with more than $100,000 in sales to South Dakota residents/businesses in a current or prior year OR 200 or more transactions with residents/businesses in a current or prior year. Hitting $100K in sales may be a little tough for smaller sellers but, having over 200 transactions may not be so tough, especially for anyone selling a lot of smaller value cards. This puts outfits like PWCC and Probstein right in their cross hairs as 200 transactions a year only amounts to about 16-17 sales a month, which is really not that many and will likely impact quite a few sellers on Ebay.

Also, this recent Supreme Court ruling is not the final action. The case actually went back to South Dakota courts then for final resolution, so the actual law has not yet officially been put into full effect yet and still has to get over some additional constitutional hurdles. Here's another article talking about the history of this and where it now stands. Still, this should start being enforced sooner than later I would think as the South Dakota courts had already aligned with the state on the legality of this. Thankfully it sounded like South Dakota was only going to enforce this going forward, and not put any added burden on businesses by trying to make the law retroactive as trying to go back and collect sales tax after the fact is virtually impossible in my opinion.

https://www.salestaxinstitute.com/re...constitutional

Another interesting question is what exactly counts as a "transaction" towards the 200 per year threshold. If someone buys from a catalog or off a website from a seller like say Kit Young or Wayne Varner, i would think the total number of things they purchased at the same time would be bundled and sold altogether as one transaction. However, if such a seller also sells items on Ebay, which I'm pretty sure both of these guys I mentioned do, I'm not sure if each individual listing being sold on Ebay would be considered as a separate transaction or not, even if someone purchased several items all at once and then bundled and paid for them through checkout in one payment. I'm guessing that is something the South Dakota sales tax department will have yet to determine and opine on.

Also, sellers have to remember that if they sell through catalogs, websites, Ebay, or via other means, the $100K and 200 transaction thresholds are for total sales and activity through all those venues added together, not just Ebay sales and transactions. Ebay sales and transactions are probably the most visible and easiest for the states to go look at though, which is another reason Ebay is very unhappy about this because they are so big and visible to the states. Sellers trying to get around this may just reduce their activity on Ebay, or get off it entirely, so South Dakota doesn't come looking for them. Ebay knows this will likely have some negative impact for them going forward, just how much, no one knows yet. Also, it will possibly put Ebay in the middle if the South Dakota sales tax department comes asking them for information on sales into their state, or detail on seller's activity such as sales amounts or the number of transactions with SD residents/businesses. They won't have much of a choice and will likely have to comply with any such requests, so this will probably cost them additional time and effort as well.

This could become real interesting, and not necessarily in a good way!!!

What I wonder is how they expect sellers on the edge of either of those thresholds to handle the collection of taxes. Are they required on sales After the threshold has been crossed? Or on all sales, so sort of retroactively.
What happens if I collect tax, and end up at say 199 transactions and under 100K? Do I refund the tax collected (which would be proper, as it wasn't required) Or do I still pay it (Which is also proper as I've collected it on their behalf, so it's owed to them)

And, if I have a competitor who hasn't met the threshold and hasn't been collecting tax because they know they won't pass that level. Can I then stick it to them by having a friend make a bunch of purchases right near the end of the year putting them over and possibly being on the hook for the taxes they'd now owe.

What a mess.

[BobC]

Originally Posted by steve B

What I wonder is how they expect sellers on the edge of either of those thresholds to handle the collection of taxes. Are they required on sales After the threshold has been crossed? Or on all sales, so sort of retroactively.
What happens if I collect tax, and end up at say 199 transactions and under 100K? Do I refund the tax collected (which would be proper, as it wasn't required) Or do I still pay it (Which is also proper as I've collected it on their behalf, so it's owed to them)

And, if I have a competitor who hasn't met the threshold and hasn't been collecting tax because they know they won't pass that level. Can I then stick it to them by having a friend make a bunch of purchases right near the end of the year putting them over and possibly being on the hook for the taxes they'd now owe.

What a mess.

Those are great questions, and things that need to be addressed by South Dakota ultimately. You're right in that it is sometimes impossible to predict exactly when you would hit these thresholds and thus become responsible for collecting and remitting the sales tax. I would suggest to anyone that felt they were going to hit these thresholds that they just start charging the sales tax and filing with SD. The thresholds are only for when it becomes mandatory under the state law, it doesn't mean that a person or company that hasn't reached the volume of sales or transactions to hit the threshold yet can't still go ahead and start to charge and collect the sales tax before they reach that point.

Also, in cases where a person/company reaches the threshold during some year, I would just start the process of collecting and remitting the sales tax at that point, and going forward. Don't forget that before doing so, the person/company would also have to register with the state of South Dakota first to let them know they are now liable for collecting and remitting sales tax. Not 100% sure what that process is in South Dakota, but you normally have to register in whatever state(s) you're in and get some kind of license or ID #, and then start filing sales tax returns and remitting the sales tax collected going forward. The states know it isn't easy to go back and try to collect sales tax from prior customers, so I doubt they'll end up forcing any person/business to do so.

As for the idea of having a friend start buying from a competitor to push them over the threshold to have to start collecting sales tax in a particular state, how would you know how close to the thresholds someone is? You could have a friend end up spending a lot of time, effort and money, for nothing. Also, just because someone hits one of these thresholds doesn't mean they'll pay attention to it. And as of right now, no one knows to what extent South Dakota, or any other state for that matter, will go to check up on companies to enforce these laws. These states don't have the resources to go after every single person/business out there to enforce rules like this. They'll immediately go after the low hanging fruit and get the big companies, like Wayfair, Amazon and Overstock to comply, if they aren't already. As to how much time and effort they then put in to go after the smaller businesses.....that is a whole other question no one can likely answer as of right now. Since these vendors are by definition outside of the state they'll be collecting sales tax for, its not like some state auditor is going to pull up at their doorstep and ask to check their records. That's where I wonder if the states will try to get third party information from someone like Ebay to start determining who to go talk to.

[Fastball]

IMO a simple solution would be to begin the taxation at sales above the $100K threshold, that way once it is reached then retailer can begin collecting taxes.

[Buythatcard]

A simpler solution would be not to have any taxes.

[BobC]

Originally Posted by Buythatcard

A simpler solution would be not to have any taxes.

Amen brother!!!!!

[insidethewrapper]

I can't believe states just don't charge per year for a "sales tax license". In Michigan, the license is free ! Just paperwork for Michigan Sales at the present time. It would be simple to just charge all businesses , for example: $ 100 a year for the license, and high volume stores etc. would need to fill out additional forms.

[BobC]

Originally Posted by insidethewrapper

I can't believe states just don't charge per year for a "sales tax license". In Michigan, the license is free ! Just paperwork for Michigan Sales at the present time. It would be simple to just charge all businesses , for example: $ 100 a year for the license, and high volume stores etc. would need to fill out additional forms.

That sounds great in theory, but wouldn't be realistic in practice. Think about it, if all you had to do was obtain and pay an annual fee of say $100 for having a sales tax license (which is more often called a vendor's license in many states) and that was it, the states would be out so much money it wouldn't be funny. At a 7% sales tax rate a business would only have to have $1,428.57 of taxable sales in an entire year to fully cover the $100 annual license fee you suggested. So under your plan the state loses out on sales tax for any sales over that amount, which would be astronomical. The states couldn't afford to lose that much revenue. So if you decided then to raise the annual fee to generate more revenue, it would end up being a large amount per business. And if you made it a flat fee so everyone seller paid the same, many smaller retailers wouldn't be able to afford it and would argue they're being discriminated against and kept out of starting new businesses or being put out of business because of the ridiculous cost for a license. So if you then try to tie the fee to some measure of the volume of business being done, that is kind of what they are doing now by charging the sales tax, right? So you sort of end up in the same place with additional record keeping and tax filings and payments, just in a different way.

You did mention in your suggestion that larger, high volume stores would have to do additional paperwork, but what exactly does that mean? As I noted above, are you saying that over a certain amount of taxable sales they'd have to start paying in more money towards their sales tax license? If so, how are you going to figure that out and who decides what the threshold is for such additional payments, and on and on? And what you are suggesting is already in practice. For example, in Ohio there is a state sales tax in force that requires seller's to apply for a one-time vendor's license at a cast of just $25. After that they are required to file and remit any sales tax they collect, even if they have $0 to report, until they formally cancel their license with the state. In addition, back in 2005 Ohio enacted something called the Commercial Activity Tax, which sounds a little like what you may be proposing. It requires all businesses that sell to anyone in Ohio to record and report their qualifying Ohio based sales and pay in what is termed a Commercial Activity Tax for sales over certain amounts. Annual Ohio based sales from $0 - $150K per year you, don't have to file or pay anything. Annual Ohio based sales of $150K - $1MM a year, you register and pay $150 with a once a year report you then file. Once your annual Ohio based sales go over $1MM though, you then have to pay in $0.0026 per dollar of sales in excess of $1MM. And this is in addition to Ohio sales tax which can be as high as 8% in some counties. When they enacted this Commercial Activity Tax back in 2005 they did away with a state franchise taxes on businesses and business property taxes on assets and inventory owned by businesses. It was an offset of one new type for for two previous types of taxes.

This type of activity tax as Ohio calls it doesn't get charged directly to the buyers, but you can be sure that prices charged to them got increased to cover the additional Commercial Activity Tax cost increase to the sellers. Oh, and unlike sales taxes which often don't get charged for things like food, the Commercial Activity tax in Ohio does cover food sales as well, so those prices go up for everyone as well. There are so many nuances to these taxes, and what is deemed fair and equitable to everyone, it is not easy to simply replace what we already do with something simple.

[insidethewrapper]

You would still have to pay the sales tax + the $100 ( example) fee, not instead of the fee.

[hcv123]

would be - if your company hit that threshold in a preceding lookback period (let's say the prior tax year as one possibility) - you would be required to collect tax in the current year.

[BobC]

Originally Posted by insidethewrapper

You would still have to pay the sales tax + the $100 ( example) fee, not instead of the fee.

OK, but that would really only end up being a drop in the bucket in terms of additional monies collected by the states in regards to sales taxes. And if the sellers still have to go through all the time and effort of collecting and remitting sales tax anyway, how does that make things any easier for them? They just end up paying an additional $100 every year, for nothing? Don't go giving states any more ideas on how to collect more money for virtually doing nothing, they do quite a good job of that already. LOL

[egbeachley]

Originally Posted by insidethewrapper

I can't believe states just don't charge per year for a "sales tax license". In Michigan, the license is free ! Just paperwork for Michigan Sales at the present time. It would be simple to just charge all businesses , for example: $ 100 a year for the license, and high volume stores etc. would need to fill out additional forms.

They usually do. The license is just an annual fee that registers you with the state. Then you get to remit all the sales tax you have collected using your new registration number.

[insidethewrapper]

Michigan to start enforcing sales tax on more online retailers

LANSING » Michigan’s 6 percent sales tax will soon be applied to many companies with no physical location in the state, according to the Michigan Department of Treasury.

The department announced Monday (August 13th, 2018)that sales tax will be collected from online out-of-state retailers that exceed $100,000 in sales or have 200 or more transactions in Michigan within the previous calendar year.

The rule change beginning Oct. 1 will bring in an extra $200 million per year in state revenue, according to the state agency’s estimates.

“We will be working closely with our retail and business partners to ensure a smooth transition to the new rule,” State Treasurer Nick Khouri said.

The move follows a recent U.S. Supreme Court ruling that gave states authority to require online retailers without a physical presence in the state to collect sales tax on their behalf.

Michigan already requires large retailers with a presence in the state, such as Amazon and Overstock, to charge the tax. — The Associated Press

[BobC]

Originally Posted by insidethewrapper

Michigan to start enforcing sales tax on more online retailers

LANSING » Michigan’s 6 percent sales tax will soon be applied to many companies with no physical location in the state, according to the Michigan Department of Treasury.

The department announced Monday (August 13th, 2018)that sales tax will be collected from online out-of-state retailers that exceed $100,000 in sales or have 200 or more transactions in Michigan within the previous calendar year.

The rule change beginning Oct. 1 will bring in an extra $200 million per year in state revenue, according to the state agency’s estimates.

“We will be working closely with our retail and business partners to ensure a smooth transition to the new rule,” State Treasurer Nick Khouri said.

The move follows a recent U.S. Supreme Court ruling that gave states authority to require online retailers without a physical presence in the state to collect sales tax on their behalf.

Michigan already requires large retailers with a presence in the state, such as Amazon and Overstock, to charge the tax. — The Associated Press

Those thresholds, $100,000 of sales or 200 or more transactions are exactly the same ones that South Dakota had in their law that the Supreme Court agreed with. Exactly what being said before, watch the other states start to copy the South Dakota law. And it begins...............!

[jcc6252]

Originally Posted by BosseFieldBoy

I got a notice from Heritage that they will be including sales tax effective 8/1. Has anyone received a similar notice from any of the other auction houses?

FYI, Here's a question I posed to HA, and their response:

For those of us who are not licensed resellers, is sales tax now added to all purchases, regardless of the buyer's state of origin? If so, do you use the buyer's sales tax rate?

Hello,

Thank you for your email. Eventually all states will have applicable sales tax but for now, the taxable states are as follows:

New York
Illinois
Florida
Texas
California
Connecticut
New Jersey
Hawaii
Kentucky
Maine
Mississippi
Ohio
Pennsylvania
Vermont

On September 1st 2018 we will be charging sales tax in:

Colorado
Massachusetts
Michigan
Oklahoma
Rhode Island
Tennessee
Washington

The tax charged will be the rate in each Buyer’s location.

[savedfrommyspokes]

Noticed the following message posted on ebay:


As you may know, the Supreme Court ruled in favor of South Dakota in June 2018, which removed the requirement that certain retailers have a physical presence in a state in order for that state to impose sales tax obligations on these retailers.

Some states have extended the tax collection obligation to marketplaces. We believe this ruling is unfair to small businesses and will continue to call for greater simplicity. In the meantime, we’re working to find the best way to support our sellers.

What this means for eBay sellers: Regardless of where you’re physically located, if you sell to buyers in certain states, those states may require you to collect applicable taxes on your transactions.

Therefore, based on these new laws, we will calculate, collect, and remit sales tax for orders shipped to customers in the following states on the following schedule:
•Washington—starting Jan 1, 2019
•Pennsylvania— starting July 1, 2019
•Oklahoma—starting July 1, 2019

Once we start collecting tax in these states, you do not need to take any action. There are no extra charges or fees for this service. Prior to these dates, please 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 into the states listed above, or out of eBay automatically collecting sales tax for items shipped to the states above.

Additional states will likely be added to the above list. Stay informed on the Help pages.

For more information on these new tax requirements, we recommend that you consult with your tax advisor. If you do not have a tax advisor, we’ve partnered with Avalara and TaxJar and they will have specific insights into the best course of action for you.

It appears for the first three states they mention, that ebay themselves will not only calculate, but collect and remit the taxes at no extra cost to the seller.

My only question is will re-sellers buying through ebay still be required to pay the sales tax?

[mintacular]

So basically as a CONSUMER BUYER of eBay items from PA PENN my bill will include a 6% tax starting JULY 2019!!!!?????

[BobC]

Originally Posted by savedfrommyspokes

Noticed the following message posted on ebay:


As you may know, the Supreme Court ruled in favor of South Dakota in June 2018, which removed the requirement that certain retailers have a physical presence in a state in order for that state to impose sales tax obligations on these retailers.

Some states have extended the tax collection obligation to marketplaces. We believe this ruling is unfair to small businesses and will continue to call for greater simplicity. In the meantime, we’re working to find the best way to support our sellers.

What this means for eBay sellers: Regardless of where you’re physically located, if you sell to buyers in certain states, those states may require you to collect applicable taxes on your transactions.

Therefore, based on these new laws, we will calculate, collect, and remit sales tax for orders shipped to customers in the following states on the following schedule:
•Washington—starting Jan 1, 2019
•Pennsylvania— starting July 1, 2019
•Oklahoma—starting July 1, 2019

Once we start collecting tax in these states, you do not need to take any action. There are no extra charges or fees for this service. Prior to these dates, please 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 into the states listed above, or out of eBay automatically collecting sales tax for items shipped to the states above.

Additional states will likely be added to the above list. Stay informed on the Help pages.

For more information on these new tax requirements, we recommend that you consult with your tax advisor. If you do not have a tax advisor, we’ve partnered with Avalara and TaxJar and they will have specific insights into the best course of action for you.

It appears for the first three states they mention, that ebay themselves will not only calculate, but collect and remit the taxes at no extra cost to the seller.

My only question is will re-sellers buying through ebay still be required to pay the sales tax?

If what is being said is true, that in those listed states Ebay will start to bill and collect the sales tax and there are absolutely no opt outs, that is 100% wrong and going against basic sales tax laws. If a bona fide re-seller purchases something through Ebay that they then turn around and sell to others, they should not be charged sales tax on the purchase. Here's a link to one of Washington State's websites talking about and explaining the use of a Re-Seller Permit in the State of Washington. It clearly states how a buyer that is going to resell something should not be paying sales tax on it.

https://dor.wa.gov/find-taxes-rates/...seller-permits

This could become a nightmare for anyone that buys items for their business through Ebay to then resell if Ebay is not going to honor their re-seller and sales tax exemption certificates. This could become a real paperwork and tax nightmare if this happens. I've got to believe Ebay hasn't fully explained what will actually happen in this case as they're probably still working this out themselves. I'm guessing before they have to actually start doing this that they will come up with a program to allow valid re-sellers purchasing items through them to submit exemption certificates that will allow those purchases to be sales tax exempt. How they're going to implement it though, and differentiate between taxable and non-taxable purchases that a buyer might make, is going to interesting to say the least.

This is exactly why Ebay was against this new Supreme Court ruling and was sending petitions out to people and asking for signatures and telling people to call their Congressmen and so on. And if Ebay does end up having to go through with this and start doing it, you can bet it is going to cost them time and money to comply. How long before you think they'll come up with some way to pass the added cost on to their dealers then???

There was another thread not too long ago where someone asked the question about the possibility that card shows might make a comeback because of all this nonsense. Well, if the various states and taxing authorities keep going after everyone like this it, it may start to happen sooner than later.

[yanks12025]

Just wanted to bump this back up with the new year 2 days away.. Has anyone heard anything new lately about this?