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Charged Sales Tax on Paypal

(1 of 14)
Charged Sales Tax on Paypal
Jun 4, 2012 08:27 AM

Today I paid for a item and a sales tax charge appeared when using paypal.  I have tried to read to understand if this is a ebay, seller, or paypal added items with little success.  If any one know how that might work I would appreciate your insight.

 

The listing did not state that sales tax would be applied, and I would not have bid the price I did if i had known. 

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Charged Sales Tax on Paypal

(13 Replies / 2,449 Views)
Charged Sales Tax on Paypal
Jun 4, 2012 08:27 AM

Today I paid for a item and a sales tax charge appeared when using paypal.  I have tried to read to understand if this is a ebay, seller, or paypal added items with little success.  If any one know how that might work I would appreciate your insight.

 

The listing did not state that sales tax would be applied, and I would not have bid the price I did if i had known. 

Last Post
by burbokhaus (119 ) View Listings
(1 of 13)
Re: Charged Sales Tax on Paypal
Jun 4, 2012 11:25 AM

Are you and the seller in the same State? if so that could be the reason.

(2 of 13)
Re: Charged Sales Tax on Paypal
Jun 4, 2012 05:23 PM

If you go to http://cgi6.ebay.com/ws/eBayISAPI.dll?ViewBidItems&all=0&userid=tb591thomas&&rows=50&completed=1&sort=9&page=1&guest=1 you can see everything you've bid on in the past 30 days.  Looking at this list I see exactly one listing purchased within the last 24 hours.  It states very clearly that sales tax will be charged for transactions in TX at a rate of 8.25% in the shipping details section.  Are you from Texas?  If so that is exactly the reason you were charged sales tax.

 

Here is a link to the Texas comptroller's office if you'd like to complain about having to pay sales tax with regards to online purchases.  http://www.window.state.tx.us/

(3 of 13)
Re: Charged Sales Tax on Paypal
Jun 18, 2012 06:34 AM

Thanks for responses

(4 of 13)
Re: Charged Sales Tax on Paypal
Jun 22, 2012 08:16 PM

If the seller has a store in your state, he has to charge tax.   It stinks but what can do. 

(5 of 13)
Re: Charged Sales Tax on Paypal
Jun 23, 2012 10:45 AM

Sellers do not have to have a brick and mortar store to have to legally charge state sales taxes.

 

They have to have a legal business which can be internet only.


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(6 of 13)
Re: Charged Sales Tax on Paypal
Jun 25, 2012 06:31 PM

I purchased a red lobster gift card  today -did not expect a sales tax. like you i would have bid less to cover that charge. Is it the seller that charges that or is it paypal?

(7 of 13)
Re: Charged Sales Tax on Paypal
Jun 30, 2012 07:07 PM

Sorry to piggy back on this topic, I have also a tax related question.

 

Things I know.  As a seller when you list an item you have specify in which state you are going to charge tax.  It is not in your face visible, you have to go the shipping details to find out if the seller charges taxes for your location. buyer beware when you bid.

And PayPal will charge taxes if requested by the seller.

 

My question is for the people that charge taxes. Who is supposed to do the reporting at the end of the year ? is Paypal that is doing the reporting as they are collecting taxes on behalf of the seller, or is it the seller that has to do it ?

 

I am asking this because I have seen some sellers charging taxes only on some item in some state.

 

(8 of 13)
Re: Charged Sales Tax on Paypal
Oct 15, 2012 08:46 AM

I know exactly what you mean.  I bought a book today and was surprised at the tax charged.  I figured it out, I was overcharged!  The tax rate where I live is 7.25% yet I was charged Chicago rates, nearly 9 1/2%, on my purchase.  I live over 100 miles away from Chicago so no doubt about the tax rate I should've been charged.

 

What can I do to get this corrected?  Or am I forever to overpay on sales tax if I buy anything on Ebay ever again? 

(9 of 13)
Re: Charged Sales Tax on Paypal
Oct 15, 2012 05:14 PM

If a seller charges sales tax, it's in the listing under payment and checkout details. It shouldn't be a big surprise.

(10 of 13)
Re: Charged Sales Tax on Paypal
Nov 5, 2012 04:05 PM

I don't think you should have been charged sales tax for a gift card. It's not a taxable item. You will be charged sales tax when you use it.

I don't think anyone should be charging sales tax on items that are not taxable to begin with.

(11 of 13)
Re: Charged Sales Tax on Paypal
Nov 8, 2012 12:41 PM

all sellers are required by state laws to collect and remit all sales taxes collected in states they do business ,Reguardless if they have a store or not in that state.. I myself have Ohio,New Jersey,Pa and West Virginia tax licenses, Because I do physical business in those states.. Let me clarify you have to live in those 4 states for me to collect... Some states like NJ and Pa do not charge tax on clothing food and other items,, So, that's why some items are not taxable. 

  If it was a gift card you can work around it by using a credit card  payment to paypal from a friend in another  state and shipping to that state .. But thats more work than its worth for a few $$$$   (It also does not matter if items used or not. It is still taxable if resold to make a profit in most states. Been there done that so dont argue that issue with me,argue with the states )

 

I really do not see why someone mentioned they'd have to pre pay tax on a Red Lobster Gift Card?   You would also be charged sales tax again when you used it..Thus being double taxed?  That one I would look into very closely.. Plus some states do not charge  tax on food? or anything ?

(12 of 13)
Re: Charged Sales Tax on Paypal
Nov 8, 2012 12:49 PM

 know exactly what you mean. I bought a book today and was surprised at the tax charged. I figured it out, I was overcharged! The tax rate where I live is 7.25% yet I was charged Chicago rates, nearly 9 1/2%, on my purchase. I live over 100 miles away from Chicago so no doubt about the tax rate I should've been charged.

 

What can I do to get this corrected? Or am I forever to overpay on sales tax if I buy anything on Ebay ever again?

I know exactly what you mean.  I bought a book today and was surprised at the tax charged.  I figured it out, I was overcharged!  The tax rate where I live is 7.25% yet I was charged Chicago rates, nearly 9 1/2%, on my purchase.  I live over 100 miles away from Chicago so no doubt about the tax rate I should've been charged.

 

What can I do to get this corrected?  Or am I forever to overpay on sales tax if I buy anything on Ebay ever again? 

 

 

The seller is probably correct if you live in Illinois.. He might be required to charge tax by the location he's doing business in  ,not where you live as that would be a nighmare to fill out reports for every location in the state. Or they have a sepearte rate for online state purchases..   

 You either need to move to Indiana ,Missouri Wisconsin etc or Vote out your politicians who say they do everything for you . LOL

(13 of 13)
Re: Charged Sales Tax on Paypal
Dec 28, 2012 05:27 PM

http://www.sba.gov/content/collecting-sales-tax-over-internet

 

This link might help explain it best. But basically it means, that if the business has an actual "physical" building, they have to charge sales tax for the state/county the building physically exists in.

 

So those business that are totally internet based and have no acutal physical store front can get away without charging the sales tax.

 

Great for the customer, but not so great if your the person that has a physcial store front and looses the sale because of the sales tax.

 

Personally I dont' mind the sales tax. I would rather pay that then have taxes taken out of my pay. Then I would only pay taxes on what I deem is absolutely necessary for me to have and if I dont' want to pay the tax on the item then I don't get it, Maybe thats the way it should be then higher priced items get taxed more. I mean hey, if the government says when I buy a new car next time it has to have a back up beeper, (who cares if it costs me more, right), so you might as well make the taxes on that higher (cause I'm not sure I'm going to pay a few thou extra for something I didn't want, and we all know its going to cost the customer that), and make the taxes in my paycheck go away.

 

Everyone keeps forgetting that this country is in trouble, the government spends money it doesn't have, bails out banks and car companies, give the rich tax breaks and taxes the rest of us more. If everyone paid what they owed, including everyone paid sales tax regardless, maybe we wouldn't be in this much trouble. But everyone wants to "get away" with not paying this and not paying that. Every little bit makes a difference. Whats the sales tax on a Hummer or a jet?! I know I'll never buy one, but you can bet the ones that do have figured out a way not to pay sales tax and anything else they can get away with, yet they can afford to pay it.

 

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