eBay

secondphaseapparel · ‎10-05-2024

Hey everyone!

I was hoping that someone could help me to understand something.

I understand that eBay has an obligation to collect taxes, charge fees, charge VAT for using the services based on UK and international law, and all of these things. I love the platform and am obviously happy to pay the fees that we need to pay to continually use the services and supply our product to their customer base.

With that being said, I need a little bit of clarification on something.

I sell a lot of my products to people overseas and I sold an item the other day, which was a low-value item, and I realised it was sold at a loss. I thought that this was a little odd because I obviously did a little bit of math before posting it, and although this particular item wasn't supposed to make excessive profit, it wasn't supposed to lose money either, so I looked into it a little.

This particular item was sold to Germany, and I realised that eBay is taking the mandatory VAT collected from the buyer for the international sale (which goes directly to them), and they are then adding it on to the order total for the seller and using this as the sale amount. They are then using this amount to charge the final value fee, regulatory fee, international fee, ad promo fee, and the UK 20% VAT before deducting it again. So in essence they are making it appear that the sale is of a higher value than it really is to make more profit. On top of that, the transaction layout does not show that this is being done, and the layout actually leads you to believe that this has not happened unless you go through in the most in depth breakdown of the specific transaction.

If anyone could share their views or opinions on this, that would be great because for me I feel like it's very unfair and somewhat shady of eBay to use this mandatory tax payment from the customer to increase the profits and charges of the seller's fees before removing it and sending it to the relevant authority.

I also contacted eBay regarding this matter and they were unable to understand what I was refering to. I told them too that if this is the case then we need to be able to know where the customers are located and the additional international VAT amount that is going to be added to our orders total prior to the sale and before accepting any offers or giving customers a discounted price. For example this transaction I have mentioned was a VAT rate at 19% but another transaction after this was a VAT rate of 23%. How can we effectively manage our mark ups with whats essentially hidden fees?

I look forward to this discussion with you all. All the best and happy selling!

rainbowtrax · ‎11-05-2024

I agree with you that it's unfair and unnecessary and is just a way for ebay to take an even bigger cut. But this is ebay and this is how they've always done it. I'm sure they would argue that it costs them to process the VAT and someone has to pay but, as they've now introduced a "regulatory operating fee" allegedly to cover their costs, they're effectively making sellers pay twice. But it's their site, they can do what they want and, being in it to make profit, they will always charge sellers as much as they can possibly get away with.

The only way you can mitigate the losses is to adjust the overseas postage costs to cover all the extra fees - FVF on a much larger amount due to higher postage, FVF on an even larger amount due to VAT, additional percentages of international fees on the whole lot. The item price itself can't be adjusted for different buyer locations so that only leaves the postage element as a way to pass the extra cost on to the buyer. Maybe not wholly ethical but someone has to pay. Like ebay, you're in business and there's no point selling at a loss. Ebay pass it on to you, you pass it on to buyers.

papso22 · ‎11-05-2024

The fees are not hidden, they are one of the few things clearly laid out in the help section on the site.

Basically eBay's business model is to calculate its fees based on the total the buyer pays, irrespective of whether that is what the seller has charged.

They are a business and there is nothing that says they have to be fair to sellers.

That's all there is to it.

a45heaven · ‎11-05-2024

They are a business and there is nothing that says they have to be fair to sellers.

And i trust sellers will remember that when ebay want something from those sellers !!

Would you recommend ebay to a friend (or enemy?).

What can we do to improve?

Following specific process'. as advised by ebay.

Opting into new ventures designed by ebay.

Paints a new complexion to life on ebay.

uraniumtech · ‎06-06-2024

You have the base for a lawsuit. NO ONE is allowed to collect ANY FEES ON VAT(not the banks, not the shops, not EBAY, not ANYONE. Here are facts. VAT is 20% not 23% not 19% (varies on product category)

You don't get to keep the vat, goverment takes that.
If ebay wan's to insert an operating fee they have to modify their payments system RIGHT NOW.
As it is now is illegal and you are in the right.
I was looking for the same kind of info when I found your post.
These 2 pictures were the exact same product. If you think that ebay is doing is ok you are very wrong.

4_bathrooms · ‎06-06-2024

@uraniumtech wrote:
You have the base for a lawsuit. NO ONE is allowed to collect ANY FEES ON VAT(not the banks, not the shops, not EBAY, not ANYONE. Here are facts. VAT is 20% not 23% not 19% (varies on product category)

The standard rate for UK VAT is 20%; the OP is not VAT registered so - other than the (UK) VAT eBay charges on it's fees - UK VAT is not their concern.

If you sell an item valued €150 (currently £128 approx.) or less to an EU buyer eBay is responsible for charging and remitting the EU buyer's domestic VAT - each EU member country sets it's own VAT rates. For example, a Hungarian buyer will be charged 27% VAT whilst a Luxembourgish buyer will be charged 17% VAT. eBay's final value fee is based on the total paid by the buyer including any local taxes eBay was obliged to charge and remit. There is nothing illegal about this but it does mean eBay are charging their fees on the highest possible amount in order to maximise them. As per eBay:

"The final value fee is calculated as a variable percentage of the total amount of the sale (which includes the item price, postage, and any applicable taxes), plus a fixed charge of 30p per order."

Give me ambiguity or give me something else.

plpmr · ‎06-06-2024

of course there's also a new regulatory operating fee.

a45heaven · ‎06-06-2024

a new regulatory operating fee

Pray tell what regulations these fees are for?

Why is it a Percentage rather than a fixed fee?

It was suggested the passing of our data to HMRC was a part of it. (Sellers were promised we could access the info which ebay was sending, but thats never happened)

ebay have already started taking the fees, why was it not combined with the standard fees?

papso22 · ‎06-06-2024

All the information available to members about this new fee is set out on this site for all members to access. If it's not there then we won't know the answer.

Ebay hasn't sent any data to HMRC yet, so there is nothing to share with sellers. It starts in January 2025.

ett1954 · ‎06-06-2024

@a45heaven :

"a new regulatory operating fee"

"Pray tell what regulations these fees are for?" - The costs eBay are incurring in providing required information to the regulatory authorities.

"Why is it a Percentage rather than a fixed fee?" - eBay's accountants have obviously calculated that this will raise more revenue

"It was suggested the passing of our data to HMRC was a part of it. (Sellers were promised we could access the info which ebay was sending, but thats never happened)" - They haven't started yet. Along with other digital sales platforms they realise this is going to put the wind up a lot of private sellers, especially 'private' business sellers creating an exodus of buyers and sellers from the site. They will leave it until the last minute - the deadline for providing the data is January 31st, 2025. Expect them to start asking for NINOs towards the end of this year.

"ebay have already started taking the fees, why was it not combined with the standard fees?" - By keeping this fee in isolation it will allow this particular fee to be increased in the future with eBay still claiming basic fees have not risen.

a45heaven · ‎06-06-2024

thanks for that.

The description below does not fill one with confidence that its just an excuse for increasing fees.

Why is the Reg Fee a sliding amount through a percentage rather than a fixed amount?

So as HMRC receiving into their FUJITSU system our confidential info does not start until Jan 2025 - this regulating fee excludes this element.

Why is the regulatory operating fee being introduced?

We’re introducing this fee to address the rising costs associated with the increasing number and complexity of regulations impacting eBay’s marketplace - including consumer and environmental protection, as well as new taxation and customs measures.