eBay: “Netflix tax” effective 1 July 2017

thydzik on 31/05/2017 - 17:24
Last edited 31/05/2017 - 17:24

Copying an email I received, couldn't find anything online.

Important: “Netflix tax” effective 1 July 2017
From 1 July 2017, Goods and Services Tax (GST) will apply to fees on eBay.com.au, due to new legislation in Australia (the "Netflix Tax").

Businesses registered for GST will not be affected by this change if you register your Australian Business Number (ABN) with eBay here.

More information on this new legislation can be found here.

Regards,
The eBay Team"

http://mail.ebay.com.au/r/mail/11c42II3fcb4eII1b8f1b583f4II2

General Discussion

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Comments

    • Zachary on 01/06/2017 - 01:49
      -2

      It'll be like 25%, well I round it to that amount(as a buffer). So if you sold an item for $100, be prepare to give at least $25 to fees….and that's not including postage and handling if it needs to be posted…

    • hazzad on 01/06/2017 - 07:34
      +1

      It should only be 10% of the final valuation or listing fee. So if the fee had been $10, it would now be $11. Same.as how gst works on any other goods or services.

  • brownbag on 01/06/2017 - 06:12
    +3

    Has anybody actually registered their ABN on this? I tried, and get an error, "User's country does not match VAT/GST/OGRN prefix". I selected AU and entered a valid ABN.

    Also, I wonder why the "Company" field defaults to "eBay, Inc" when you use the link on the email. That seems odd - it should leave it blank so that you can enter your company name.

    • wittyidea3460 on 01/06/2017 - 23:02

      Worked OK for me.

    • strafe on 02/06/2017 - 09:58

      I had the same problem. Also, the business name field is only 15 characters long.

    • wattstar on 02/06/2017 - 23:57
      +1

      I believe eBay already report sellers income when it exceeds a certain threshold. By collecting ABNs now the government can monitor all income from eBay and link it to an ABN. I wouldn't be surprised if they send out letters who declare a lower amount at the end of the year. It's just like Taxable Payments Annual reporting for contractors.

      It's going to get to the stage where government will want full transaction details.

      PS contractors should have a look at the text in the files that are sent to ATO for the Taxable Payments Annual Report, it is meant to be just ABN, name, address and payment amounts. However software providers like Reckon also send the contractors bank account details if they are stored in Reckon! Very, very wrong if you ask me!

    • foxmulder on 05/06/2017 - 13:43

      Hi I failed few times previously when trying to enter in the ABN, but just now it works. You may just need to try again.

      • matt-ozb on 05/06/2017 - 20:25

        is your ABN registered for GST?

        • foxmulder on 12/06/2017 - 07:28

          Yes it's GST registered.

    • MelbBoy on 12/06/2017 - 01:22

      I've got this error too. Did you manage to fix this in the end ?

  • Sirley11 on 01/06/2017 - 06:38
    +2

    Ok the question that I have. The link that eBay is directing you to read about the tax: https://www.ato.gov.au/Business/International-tax-for-busine…
    Says clearly its for digital goods and services except goods or real property.
    So if you're selling goods and not, digital stuff or services, it shouldn't effect you or what? I'm trying to call to ebay today and get the clearer answer about the % too, cause if it's going to be +20% it going to be ridiculous fort he sellers, not that it's not super expensive already. :(

    • Tomtek-Outdoors on 01/06/2017 - 16:59

      I think because ebay is technically selling sellers a digital product…thus they will be required to charge GST.

    • matt-ozb on 05/06/2017 - 20:23

      I dont what on earth you are talking about. this is pretty simple really … ebay just need to pay GST to the ATO for the fee of their ebay service. ie it is 10% GST on the approx 10% ebay selling fees of whatever is sold.

      https://www.ato.gov.au/Business/International-tax-for-busine…

  • [Deactivated] on 01/06/2017 - 09:06
    +4

    eBay are f**ked. Seriously. God knows where all the hefty fees go. Look at the website - it's clunky as hell. All these sales and discounts and so on lately all point to the fact that they're loosing business and overall marketshare. Nothing sells like it used to : freeloaders everywhere, i'll post something up and get so many stupid offers that don't reflect true market value. Confirmed when the item does sell after 25 days without fuss to someone who actually realises it's true value. Auctions? Forget about it. You never get what items are worth because overall it seems far less people can be stuffed actually bidding on an item - so you're left with a few bidders and less competition and less return. eBay is nothing like it used to be.

    • [Deactivated] on 01/06/2017 - 10:09
      +6

      A few years ago I read a story about ebay attempting to shift it's business to fewer and bigger sellers selling outlet products. You can see that happening. They have been delberately mistreating smalltime sellers. I think the accountants determined that resolution processes on smalltime transactions are too expensive.

    • cameldownunder on 01/06/2017 - 18:43

      Small Switzerland has it's own Auction site, since years. Nobody bothers to post on ebay in Switzerland ( except China )

    • B3 on 01/06/2017 - 20:54
      +1

      There's no such word as loosing.

      • CVonC on 02/06/2017 - 05:33
        +4

        It's the opposite of tighting!

  • msmhw on 01/06/2017 - 10:06

    So this 10% GST of the total sale price (so seller will bag 20% fees now of the sale price) or 10% of the eBay fees they already taken?

    I am kind confused :/

    Also what I understand this applies if you have business subscription with eBay, how about if you have private account but you sell a lot of items?

    • cloudy on 01/06/2017 - 11:46
      +2

      10% on eBay fees.

    • inthemoney114 on 01/06/2017 - 15:56

      11% in total - (if $100 price 10% fees = $10 + 10% gst on $10 = $1 so $11 on $100 in seller fees)

  • zizoubka on 01/06/2017 - 12:00
    +6

    I called eBay to clear this up. It's confirmed that GST will be applied on eBay fees, not on item sale price.
    Have a look at all monthly invoices I've got from eBay there's no GST applied. There will be from July.
    Thinking about upgrading my seller subscription to the next level…

    • proudwanderer on 01/06/2017 - 13:03

      How much is it to upgrade to the next level?

    • matt-ozb on 04/06/2017 - 09:34
      -1

      there was nothing to 'clear up'.

      you just stated what the announcement stated.

      not sure why most people here are confused with the 'amazon tax' with is a separate piece of proposed legislation. ie the GST on the goods value.

  • YellowDieselGolf on 01/06/2017 - 15:20
    +10

    I will never step into a harvey norman again.

  • jason101 on 01/06/2017 - 16:48
    +4

    Basically eBay are jacking up all fees by 10% to pay the GST they should have always been paying and are asking business users to upload a copy of their ABN so they can issue tax compliant invoices. The problem is their portal to upload your ABN doesnt work ;-(

    Net effect is businesses will pay and then reclaim the GST back as an input credit - mum and dad sellers on ebay pay and extra 10% in ebay fees.

  • Tomtek-Outdoors on 01/06/2017 - 17:04
    +5

    This is actually good news for everyone. Ebay has been charging us sellers without paying the GST, therefore, the government funds is affected. I myself am not bothered by this since we are registered for GST so can claim back the tax as credit. Also, It feels good to see that those chinese sellers posing as sellers in darwin would be slugged with higher seller fees compared to me.

    • tikei on 01/06/2017 - 19:12
      +6

      Meh, those chinese sellers posing as sellers in darwin would most likely just bump up their prices by 1% and still be cheaper than you

      • neonlight on 02/06/2017 - 07:57

        Why exactly they want to pretend as selling in Darwin….. What's the reason? Wanna make people think they are local sellers and fast shipping? eBay doesn't police the proof of location anyway. You can say you are located anywhere in AUS but your stuff is from China, except it takes a month to get to you by sea

        • pizzip on 02/06/2017 - 10:34
          +2

          I usually check "Australia only" when looking for most things on eBay so I guess it's to avoid their products being filtered.

        • OzzyOzbourne on 02/06/2017 - 12:43
          +1

          And when the item breaks, they tell you to return to an address in China, using our extortionate overseas registered post, then you need to try to claim the cost from them.

        • Tomtek-Outdoors on 05/06/2017 - 02:27

          I was actually told by a friend who is from china that they have a program that allows them to open multiple accounts on different ebay sites with a few clicks… It just didn't go mainstream because it was written in mandarin. Ebay can close their accounts…only to have them open 10 more the next day…so they finally gave up. I can't say if its true though. Must be the setting on those have darwin as default?

    • centrelink on 04/06/2017 - 18:36

      haha, I bet the chinese seller will still find a way around it anyways as per usual

  • nowlan on 01/06/2017 - 20:28

    arnt 2nd hand goods gst exempt?

    • geoffellis on 02/06/2017 - 11:37
      +5

      Ebay isn't selling you a second hand good. they're offering you a digital service for money. That service needs to be taxed. It has nothing to do with the actual item being sold between members.

    • matt-ozb on 04/06/2017 - 09:35

      nothing to do with GST on the value of the goods.

      you didnt read the announcement accurately. please re-read.

  • milhau5 on 01/06/2017 - 22:35
    +1

    I hope I'm not coming across as ignorant but I'm pretty sure this email is a complete scam?… Enter ABN here? 'Netflix' tax? I got the same email the other day and laughed at it right away. Even the email address just didn't seem convincing

    • wittyidea3460 on 01/06/2017 - 23:07
      +2

      It's legit. Login to your ebay account and check your messages there. You'll see it there as well.

      • milhau5 on 01/06/2017 - 23:19
        +1

        Wow, just had a look, thanks for the heads up. What a shame :(

  • Chiraag on 02/06/2017 - 00:38
    +6

    I dont see what all the fuss here is about.
    Ebay PROVIDES a service to Australian Business who's Customers are mostly in Australia.
    So They SHOULD have always been Invoicing including TAX ( GST)
    BUT they Did NOT for all these years.

    It to 10 years ++ for the ATO to do something about it.

    • [Deactivated] on 03/06/2017 - 10:13
      +1

      Well, GST has been charged on shipping at Australia Post for quite a while. ebay have charged a commission/fee on that shipping, GST inclusive. Now a tax is being applied to a fee on a tax on a shipping fee that goes to Australia Post anyway and is not a profit.

      Could you please explain why a tax on a fee on a tax is fair.

      • matt-ozb on 04/06/2017 - 09:38

        That's how all business operates.

        You some flour at coles and pay GST.
        You buy some bread at the bakery and pay GST.
        You take it to your shop and make a pizze.
        You sell the pizza including GST.

        • [Deactivated] on 04/06/2017 - 09:41

          No it's not. ebay commissions are not the same as a flat product with GST.

        • matt-ozb on 04/06/2017 - 09:45

          @Frugal Rock:

          Goods & Services Tax. I think you're forgetting the services part.

        • [Deactivated] on 04/06/2017 - 09:45

          @matt-ozb:
          You are the one thinking pizza parlours pay GST on their flour.

        • matt-ozb on 04/06/2017 - 09:50

          @Frugal Rock:

          I think you will it very hard to find a supplier of your flour with a revenue of less than $75K which would be the only way the flour seller could avoid paying GST to the ATO.

          Why do you think ebay should avoid paying GST on their revenue for their services that they provide?

          I guess the government could always increase your personal income tax to make up for the lost taxation revenue if eBay continue to avoid paying GST.

        • [Deactivated] on 04/06/2017 - 09:52
          +2

          @matt-ozb:
          From the ATO:

          Examples of 'GST-free' foods are:

          bread and bread rolls without icing or filling
          cooking ingredients such as flour, sugar and cake mixes
          fats and oils for cooking

          Are you for real?

          "I think you will it very hard to find a supplier of your flour with a revenue of less than $75K which would be the only way the flour seller could avoid paying GST to the ATO."

          For a GST-free food I think it would be pretty easy to find. Everywhere.

        • matt-ozb on 04/06/2017 - 10:19

          @Frugal Rock:

          You're smart enough to understand the principal.

          Apply the principal to any product or service.

        • [Deactivated] on 04/06/2017 - 10:22
          +2

          @matt-ozb:
          You just did and failed. Have the last word if it's important to you.

      • Tomtek-Outdoors on 05/06/2017 - 02:35

        I don't think this is accurate. The Ebay Satchels you purchase through Ebay is billed to you, through ebay fees. I have went through them in detail and could not see them having GST component. As a matter of fact, the ebay satchels are more expensive than click&send ($7.27+GST), if you're registered for GST. They are actually reselling it for Auspost, without the GST component plus a bit of commission.

        • [Deactivated] on 05/06/2017 - 08:11

          "6.2 Charges for the Delivery Services may be varied at any time at Australia Post's discretion. If a Customer does not accept any variation to the charges, the Customer should cease selecting and purchasing the Delivery Services through the eBay Label Printing Service. Charges are GST inclusive where GST is applicable."

          You'd pretty much have to demonstrate that domestic postage does not have GST apllicable to be correct.

  • Most Wanted on 02/06/2017 - 05:32

    I use AliExpress anyway …

  • neonlight on 02/06/2017 - 07:56

    This is the final straw. Guess I won't be using eBay to sell anything

    • matt-ozb on 04/06/2017 - 09:39

      would you rather ebay avoid their contribution to the australian taxation income as they avoided for many years?

  • Jabba the Hutt on 02/06/2017 - 10:12
    +2

    Pretty trivial relative to the effect of eBay's own fee hikes in recent years. Thought I'd refresh my memory on those…

    For a non-store seller in 2010, the eBay fees on an item that sold for $150 were $6.30-$8.50 (depending on the opening price), or $7.15-$9.65 in 2016 dollars. In 2016, the fee was $14.85 - a 54%-108% increase in real terms.

    Or say I auctioned a camera with an opening bid of $0.99, and it sold for $585 + $15 postage. In 2010, the fees would have been $18.26, or $20.72 in 2016 dollars. In 2016, the fee would have been $59.40 - a 187% increase in real terms.

    • wittyidea3460 on 02/06/2017 - 23:30

      The way you compare is a bit confusing. Why wouldn't you just compare fees by percentage? or am I missing something?

      • Jabba the Hutt on 03/06/2017 - 08:10
        +1

        The old fee structure gets in the way of a straightforward comparison to the current 9.9% of the total for non-stores. The final value fee percentage varied based on closing price, insertion fees applied (no 40 free listings/month), and postage was exempt from fees.

  • Elnato on 02/06/2017 - 10:44
    +1

    I don't get why eBay can't absorb this ridiculously small fee instead of just passing it onto the sellers, they're the business selling us the digital platform to sell on, shouldn't they be charged this "Netflix tax"

    • neonlight on 02/06/2017 - 11:51
      +3

      its another excuse for fees hike, you know it. We want Amazon here NOW!

      • Elnato on 02/06/2017 - 12:49

        Can't wait for Amazon to come here

        • matt-ozb on 04/06/2017 - 00:48

          do you think amazon will take higher risks to avoid australian taxation laws?

          why is it unreasonable for eBay to avoid paying GST?

          even a small business with an $80K turnover must pay GST.

        • RocketSwitch on 06/06/2017 - 14:27

          Me too, I'm waiting for Amazon, hope they don't disappoint!

        • Elnato on 06/06/2017 - 15:37
          +1

          @matt-ozb: It's not, but eBay shouldn't be passing it onto its sellers with all the fee's they charge, they provide the digital platform for sellers, which they charge for and then expects sellers to pay more again

        • punter1 on 28/11/2017 - 15:49

          @justmiike:
          Amazon selling fee is more than eBay, around 13-14%

      • matt-ozb on 04/06/2017 - 00:47

        'fee hike'?

        Complying with taxation laws is hardly optional.

        GST 'will apply to fees on eBay.com.au' … notice this is GST on the ebay service fee and not the cost of the goods.

        • Ryxxi on 04/06/2017 - 12:02

          That service fee is paid by the seller. So He will have to account for the Netflix tax on top of e bay fee's now when selling something. So indirectly its gst on used goods if you are selling used stuff. In this case if e bay's service fee shud have included GST from the start. This just a fee hike for people who want to sell used stuff. Doesn't effect Store fronts tho.

        • matt-ozb on 04/06/2017 - 14:29

          @Ryxxi:

          How eBay manages their GST collection is not the seller's problem.

    • OzzyOzbourne on 02/06/2017 - 12:44
      +1

      Same as why the banks won't absorb their levy

    • Xastros on 02/06/2017 - 16:39

      You should ask yourself, if they can pass it on, why would they absorb it? They are a business and out to make the largest profit they can.

  • asrey1975 on 02/06/2017 - 20:13

    so what happens if your a private seller with something that is second hand? not brand new? they charging GST on second hand goods now too?

    • wittyidea3460 on 02/06/2017 - 23:31
      +2

      As was said earlier.. this isn't GST on the item. ebay doesn't sell items.. ebay sellers do.
      The GST we're talking about here is on the fees you pay to ebay.

  • BargainKen on 02/06/2017 - 21:44
    -1

    FeeBay charging more fees. Nothing new here

    • matt-ozb on 04/06/2017 - 00:43

      Charging GST is not optional for a business. There are tax laws that businesses need to comply with.

      Maybe you should talk to the Commonwealth not eBay if you are not happy.

  • aragornelessar on 02/06/2017 - 21:59

    What advantages/disadvantages are there of adding an ABN to eBay? Do you need to sell a certain amount for it to be worthwhile?

    • matt-ozb on 05/06/2017 - 20:25
      +2

      I assume your ABN would need to be registered for GST. There is no minimum revenue for your business to register for GST, but if your revenue is more than $75K then you must register (then you are stuck with the quarterly BAS statements which is a pain).

  • [Deactivated] on 03/06/2017 - 13:53

    NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!!!!! $#@&*

    • matt-ozb on 04/06/2017 - 09:41
      -1

      Would you rather eBay continue to avoid paying GST on the services that they provide and then the Government increases your personal income tax to make up for the reduced taxation revenue?

  • [Deactivated] on 04/06/2017 - 10:10

    I received this email too and thought it was spam. it didn't have my name in it AND the logo doesn't have the eBay colours.

  • Ryxxi on 04/06/2017 - 11:51

    1 more reason not to sell private/used goods on e bay.

  • fedupwithjunk on 05/06/2017 - 00:45

    So regardless of whatever argument you want to start about taxes, the end result is the same. Ebay fees will go up again! This will have little effect on the buyer of low starting price auction items but you will ultimately pay more for fixed price items because no-one is going to absorb that cost.

    I guess we will eventually see a drop in personal sales on Ebay as it becomes too expensive to sell eg your old camera, especially if paypal was involved.

    Something new different will takes its place.

    PS. I just thought, this will be extra paperwork for ebay so we can expect to see another fee hike soon to cover the extra work. ;~) Bring back the barter system?

    • centrelink on 05/06/2017 - 01:43

      eBay has been pushing this for years now. They don't want the stigma of being known for selling second hand goods anymore and sites like gumtree and quicksales failed (well gumtree was picked up by eBay).

      Now the presence of Amazon has come and it has definitely spooked eBay given that they done quite a lot of sales recently and something called eBay valet which I am guessing is trying to compete with Amazon prime free 1 day shipping looks like it's going to fail completely. I sell some goods on eBay but will definite give Amazon a go.

      I can't even mention the word Amazon on the eBay forums as it will result in a ban… Talk about censorship lol..

  • matt-ozb on 05/06/2017 - 13:09

    Just got my update for Amazon web services …

    Hello,

    Australia recently changed its tax legislation to impose Goods and Services Tax (“GST”) on electronic services sold by non-resident suppliers. Consequently, effective July 1, 2017, Amazon Web Services, Inc. will be charging GST on cloud services provided to individual (non-business) Australian customers. GST will not be added on cloud services provided to Australian business customers who are GST registered. Amazon Web Services, Inc will charge GST, and issue corresponding tax invoices, on certain Amazon Chime, Amazon Connect, and Snowball services supplied to business and individual customers.

    To determine if a customer is a business or individual, Amazon Web Services, Inc. relies upon your provision of a valid Australian Business Number (ABN) if you are GST registered. As such, if you have a valid ABN and are GST registered, please visit our tax settings page to enter your ABN for each of your accounts. Provided you have uploaded a valid ABN, Amazon Web Services, Inc. will not apply GST on most future purchases of taxable services under the relevant account.

    Please contact us at https://aws.amazon.com/support if you have any questions.

    Sincerely,
    Amazon Web Services

    Amazon Web Services, Inc. is a subsidiary of Amazon.com, Inc. Amazon.com is a registered trademark of Amazon.com, Inc. This message was produced and distributed by Amazon Web Services Inc., 410 Terry Ave. North, Seattle, WA 98109-5210

  • ashtrayc2c on 09/06/2017 - 19:55

    https://www.lifehacker.com.au/2017/06/the-netflix-tax-is-com…

    So has it passed? According to this it's not passed yet from the last paragraph.

  • AncientWisdom on 13/06/2017 - 01:28

    The email from eBay has freaked me out (as a small seller) but now that I understand it's just GST on fees I'm pretty "meh" about it. As a business I pay GST on every single thing I spend money on so it's just part of the cost of doing business in this country. eBay definitely could have worded that email allot better though!

    To all the people hating on eBay (and I am no fan by any means): what is the current alternative? There is no other platform in Australia with such high seller/buyer numbers.

  • wkd on 15/06/2017 - 17:11

    If you’re a private seller:
    GST of 10% will be applied to your fees and will be shown on your monthly invoice. We recommend you familiarise yourself with our updated rate card ahead of this change.

    so instead of hitting the overseas sellers, this tax hits the regular aussie who wants to sell an item on ebay. well done malcolm turnbull.

  • thydzik on 15/06/2017 - 17:23

    Further Information: "Netflix tax" effective 1 July 2017
    Dear XXXXX

    You might have seen our recent email about changes to Australian tax legislation (the "Netflix" tax) which will impact fees on eBay. We want to provide you with some further details about this change and how it may affect you.

    This legislative change imposes Goods and Services Tax (GST) on digitally delivered services offered to Australian based consumers by non-resident suppliers, starting 1 July 2017. This includes the eBay service.

    If you’re a private seller:

    GST of 10% will be applied to your fees and will be shown on your monthly invoice. We recommend you familiarise yourself with our updated rate card ahead of this change.

    If you’re a business seller:

    If you have a valid Australian Business Number (ABN) and are registered for GST, you can get an exemption by registering your ABN with eBay here (make sure you enter your ABN with no spaces). No GST will be applied to your fees.

    To help you understand this change, see our updated rate card and our frequently asked questions.

    Regards,
    The eBay Team

    http://mail.ebay.com.au/r/mail/4845cII491e71II1b927bad0caII2

  • proudwanderer on 15/06/2017 - 17:23
    +1

    Here's the updated "rate card":

    http://sellercentre.ebay.com.au/sites/default/files/complete…

    So it looks like eBay is just going to be charging a flat 10.9% FVF - up 0.1% from the current 9.9%

    This should not be correct as 10% GST inclusive on a 9.9% fee should be 10.89%

    Now this may not look like much but it adds up.

    For example for every $1000 sold eBay is currently collecting $99 in fees. With the Netflix tax, they will be paying $9.90 GST to the government. —> a total of $108.90

    But since they are going to now charge 10.9% on the sellers they will be collecting $109.00 in fees for every $1000 sold.

    Does this mean that eBay will be pocketing an extra 10c per $1000 sold on the site?

    It's not much. But it adds up …. probably millions of dollars of items gets sold every month on ebay.com.au

  • [Deactivated] on 19/06/2017 - 22:56

    its being delayed until July 2018!!!
    https://www.lifehacker.com.au/2017/06/the-netflix-tax-has-be…

    • proudwanderer on 21/06/2017 - 14:06

      Only for overseas imports.

      The "Netflix tax" which this eBay fees hike is related to comes into effect 1 July 2017.

      Read the article again…

      • [Deactivated] on 22/06/2017 - 02:03

        Look at the original URL……

        Life hacker amended the story after they and then I posted it…

        • proudwanderer on 22/06/2017 - 10:13

          Ah yeh I see now…

          Would have been good if the Netflix tax was delayed too though

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