eBay and PayPal Make Changes on How Sales Tax Will be Managed for Sellers

eBay Sales Tax Update
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11 new states have adopted Internet Sales Tax policies as of October 1, bringing the total to 34 states that now require the collection of sales tax.

As the impact of this tax law becomes more apparent, PayPal and eBay are making changes that will make Internet Sales Tax collection less complex for buyers and sellers.

Starting in November 2019, the way taxable transactions are processed and how taxes are collected for remittance will change, as follows:

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

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

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

Sellers will not have to take any actions for these changes. eBay also reminds sellers that buyers will be responsible for all taxes due.

eBay sellers can learn more about Internet Sales Tax in the eBay Seller Center.

Also, sellers who have questions about how Internet Sales Tax may affect them should contact their tax advisor, or eBay’s partners Avalara and TaxJar.

Sellers who use eBay Managed Payments are not impacted by this change.

What do you think about how eBay and PayPal plan to manage sales tax moving forward?

Please use the comments section below or head over to our Facebook Group for Small Business Sellers and interact with other small business owners.

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  1. Since the gross order total is what will be processed into our accounts, does that mean that the ebay fvf fee will be based on the gross amount? (Meaning…are they charging the fee based on the Gross amount? Ditto for Paypal? ) Also, how will ebay be classifying the charge when they take it out? Won’t it appear that the Sales Tax is coming from the seller, rather than the buyer? Does this mean ebay is going into our Pay Pal accounts and creating a debit every time we make a sale?

  2. eBay consistently overcharges me on sales taxes as a buyer (I often use eBay to source items for resale). Can someone please ask eBay about this & where I get that money back–or better yet, how I use my valid reseller’s permit to NOT pay that tax in the 1st place)?

  3. wtf? i have to pay taxes for used phones? im out of ebay. spent hundreds of thousands of dollars over the years on their platform, now my money will go somewhere else.

  4. I have been buying off e bay for long while, using Paypal as means to paid for what I purchased, however now it seems that what I buy paying with paypal is taxed by ebay and ebay adds their tax amount not with purchase but their own charge that went into my paypal acct. I thought these were fraud charges, even my cardholder said it was fraud number used to collect this charge. Reported it to fruad, then got ahold of paypal and they told me it was ebay going back and collecting sales tax on what I had brought on e bay but paid through my paypal account. I don’t understand how they can now do this without contacting buyer that they are going to do this?


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