A sales tax is collected by the seller. It's added to the cost of the buyer. It's remitted to the state where the sale occurred... And it's collected when something is sold, not delivered.
UNLESS the buyer is out of state. An out of state buyer will most likely owe a use tax on an item that is ineligible for the sales tax. The use tax is owed by the buyer back in his home state.
What eBay does, in an agreement with the states, is to collect a sales tax and pass that on to the correct state. Two things... I think it's wrong that they collect tax on shipping and handling, I don't think that's taxable in my state. Hell, if I buy stamps at my Post Office, Kentucky isn't getting a sales tax on that! Second thing, I bet in the massive agreement among eBay and the states, they send that tax money to the states every 30 days, 60 days, or something like that... probably has language about waiting to make sure the transaction between buyer and seller is completed and there aren't returns or problems. AND the real reason they'd do that is so eBay could have all of that tax money for a month or two or more and draw interest on the money, which eBay keeps. A month of interest on that may not be megabucks, but it would be free money for eBay made on other people's money.
Did cities that have a sales tax get a seat at the table with the states and eBay?
Last edited by FrankWakefield; 03-17-2022 at 08:34 PM.
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