The Pro's Closet at it again

[Old School]

Originally Posted by prototoast

Sales tax on eBay is based on the state where the buyer is located, not based on where the seller or ebay itself is located.

Not necessarily true. Many states besides California (I do not know exactly which, Hawaii is one) collect sales tax on ebay purchases, and charge Ca sales tax.

I know this because I had to open a pass through account for sales tax that ebay collects on my behalf, that is never seen by my company.

Originally Posted by prototoast

TPC was already large enough that they have been collecting and remitting sales tax through their direct sales as well. The tax thing shouldn't make a difference for them whether or not to sell on eBay.

This has always been true if you RESIDE in California, that you are SUPPOSED to pay CA sales tax (use tax) whether it is pre-collected or not . The criteria for pre-collecting and forwarding sales tax is based on the $ volume a Boulder (Austin, NYC, Minnesota) company does to that state

Originally Posted by prototoast

No idea if eBay offered them a deal to get them back on, or TPC just had some inventory that wasn't moving so they decided to experiment.

My gut feeling is ebay is scrambling. I have a LOT of hobbies, and when I used to say "oh, I need a Honda Dream seat", I would log onto ebay and pick the best one, and click "buy it now".

Now, I am hard pressed to find anything to augment any of my hobbies.

[yinzerniner]

Originally Posted by Old School

Not necessarily true. Many states besides California (I do not know exactly which, Hawaii is one) collect sales tax on ebay purchases, and charge Ca sales tax.

I know this because I had to open a pass through account for sales tax that ebay collects on my behalf, that is never seen by my company.

This has always been true if you RESIDE in California, that you are SUPPOSED to pay CA sales tax (use tax) whether it is pre-collected or not . The criteria for pre-collecting and forwarding sales tax is based on the $ volume a Boulder (Austin, NYC, Minnesota) company does to that state

My gut feeling is ebay is scrambling. I have a LOT of hobbies, and when I used to say "oh, I need a Honda Dream seat", I would log onto ebay and pick the best one, and click "buy it now".

Now, I am hard pressed to find anything to augment any of my hobbies.

CA Taxation website disagrees with a few of your points:
https://www.cdtfa.ca.gov/formspubs/pub101/

Seems pretty cut and dried - if you take delivery of an item in CA then you have to pay CA sales tax, if you take delivery of the item out of state then the buyer is responsible for paying the sales tax of state where delivery is taken.

I do remember some states have a cap on $ amount they cannot exceed without pre-collection of sales tax - some it's $200k gross revenue per state, others it's less.

It does mention another form with other considerations for exemption from CA sales tax, : Regulation 1620, Interstate and Foreign Commerce

[Old School]

Originally Posted by yinzerniner

CA Taxation website disagrees with a few of your points:
https://www.cdtfa.ca.gov/formspubs/pub101/

That just reinforces my point that ebay is stupid to be the last big tech company to move to Austin, or Reno, or Bend.

A buyer from Hawaii (see below), now has to figure in 7.25% added on top, for an item not from California, being shipped to a state that is not from California, simply because the CEO of ebay likes his house in Los Gatos or wherever.

In any case, I hope the best for Pros Closet and their Angel Investors.

[yinzerniner]

Originally Posted by Old School

That just reinforces my point that ebay is stupid to be the last big tech company to move to Austin, or Reno, or Bend.

Where Ebay is headquartered has NOTHING to do with their collection of Sales Tax. If they were headquartered in the Caymans they STILL would need to collect sales tax.

See: South Dakota vs Wayfair:

https://taxfoundation.org/tax-basics...ota-v-wayfair/

[Big Dan]

I pay Florida tax on the crap I buy.

[Old School]

Originally Posted by yinzerniner

Where Ebay is headquartered has NOTHING to do with their collection of Sales Tax. If they were headquartered in the Caymans they STILL would need to collect sales tax.

See: South Dakota vs Wayfair:

https://taxfoundation.org/tax-basics...ota-v-wayfair/

There is no such thing as "Oregon vs. Wayfair", for example.

My point is that if ebay was in Oregon or Texas or horrors Florida (not South Dakota or California) that a person in Hawaii would not pay 7.25% sales tax to a state they don't live in.

[Clean39T]

Originally Posted by Blown Reek

I had a "we'll get back to you when we're buying used wheels again" offer a few months ago, and of course it was lower than I expected, which was to be expected. However, when they recently decided to buy used stuff again, I received an email regarding my wheels for substantially less than their previous offer.

Nothing changed- I didn't resubmit anything or follow up with their initial offer, and the offer number was the same, just substantially less. I can only think that the free-flowing venture capital money isn't as plentiful as it once, especially since the market is changing and they have a ton of inventory.

Some offers I got on re-submittals were also significantly reduced..

Recession confirmed.

[Old School]

Originally Posted by Clean39T

Some offers I got on re-submittals were also significantly reduced..

Recession confirmed.

Dude.


I now put everything on my "watch list", and wait for the "offer from seller' to roll in.

[Mark McM]

Originally Posted by Old School

There is no such thing as "Oregon vs. Wayfair", for example.

My point is that if ebay was in Oregon or Texas or horrors Florida (not South Dakota or California) that a person in Hawaii would not pay 7.25% sales tax to a state they don't live in.

I'm not sure what you are talking about. When ebay collects sales tax, they are basically acting as an agent of the state in which the buyer takes delivery. The sales tax rate is based on the tax rate in which the buyer takes delivery, and ebay remits the money to the state in which the buyer takes delivery.

From the buyers perspective this isn't much different than buying something from the retailer down the street. If someone lives in Hawaii and buys an item from a retailer in Hawaii, then the retailer collects the 7.25% Hawaii sales tax, and remits the tax to the Hawaiian government. If that that same person were to buy the exact same item through ebay from a seller in California, then ebay would collect the 7.25% Hawaii sales tax, and remit that tax to the Hawaiian government.

[Old School]

Originally Posted by Mark McM

I'm not sure what you are talking about. When ebay collects sales tax, they are basically acting as an agent of the state in which the buyer takes delivery. The sales tax rate is based on the tax rate in which the buyer takes delivery, and ebay remits the money to the state in which the buyer takes delivery.

From the buyers perspective this isn't much different than buying something from the retailer down the street. If someone lives in Hawaii and buys an item from a retailer in Hawaii, then the retailer collects the 7.25% Hawaii sales tax, and remits the tax to the Hawaiian government. If that that same person were to buy the exact same item through ebay from a seller in California, then ebay would collect the 7.25% Hawaii sales tax, and remit that tax to the Hawaiian government.

Good point. I didn't know Hawaii and California had the exact same sales tax rate. (and the same laws).

[prototoast]

Originally Posted by Old School

There is no such thing as "Oregon vs. Wayfair", for example.

My point is that if ebay was in Oregon or Texas or horrors Florida (not South Dakota or California) that a person in Hawaii would not pay 7.25% sales tax to a state they don't live in.

You severely misunderstand how any of this works. Since the Wayfair decision, states can collect sales tax on remote purchases to buyers in their state from sellers that are out of state. Before Wayfair, this was only the case if the seller had a physical presence in the state.

No one is paying sales tax to states they don't "live" in (here, it's not about live, but the address associated with the purchase). Ebay collects and remits tax to Hawaii for a product shipped to Hawaii, regardless of where the seller is located. Ebay collects and remits tax to California for a product shipped to California regardless of where the seller is located.

Ebay could not relocate to Oregon or Texas or Florida and avoid remitting taxes to these states. That used to be possible before Wayfair, but not anymore.

[Mark McM]

Originally Posted by Old School

Good point. I didn't know Hawaii and California had the exact same sales tax rate. (and the same laws).

Sorry, I misread which state had the 7.25% tax rate.

However, in many cases there has been no change in tax laws. For example, here in Massachusetts, purchases made by state residents have long been subject to the Massachusetts state sale/use tax. Before the Wayfair decision, when purchases were made in-state the retailer would collect and remit the taxes, and when purchases were made out-of-state the buy was responsible for reporting the purchase and remitting the tax. Since the Wayfair decision, out-of-state retailers who deliver to Massachusetts are now required to collect and remit the taxes. In either case, the buyer owes the same tax, and the tax is remitted to state. The difference for the buyer now is that it is harder for to (illegally) evade state sales taxes.

[BobbyJones]

eBay happens to be the cheapest, hyper-targeted, ad-hoc advertising a business can buy.

Maybe they got their agency bill for the year.

[KJMUNC]

With the exception of the very first bike I sold to TPC 2+yrs ago, all of their other offers to buy have been low-balls. It may be frustrating, but I don't begrudge them for trying to buy low and sell high. If you don't need to sell or think other markets will yield a better price, those options always exist. But for the seller who needs cash today or doesn't want to deal with the hassle of tire kickers, scam emails, etc., it's still an attractive option.

I also suspect that in the early days they were buying whatever they could to boost inventory and eyeballs but have since gotten a lot smarter on their pricing and focused on only buying when they believe there's a high probability of reselling at whatever margin their hurdle rate requires.

I submitted a bike last week and got the "we're not buying right now, but here's what we might offer when we buy again". LBS are again complaining about being able to get complete bikes in to sell, so I expect TPCs model will hold out for a while longer, assuming people keep buying (big assumption)

[Old School]

Originally Posted by KJMUNC

have since gotten a lot smarter on their pricing and focused on only buying when they believe there's a high probability of reselling at whatever margin their hurdle rate requires.

I agree 100%