eBay Champions No Sales-Tax For Cross Border and Fake Goods

Selfish, destructive and greedy?

April 18, 2018 - Los Angeles, CA – eBay has gone to the mat, filing a Supreme Court amicus curiae brief to protect its profits through a system that allows U.S. and cross-border “Marketplace” sellers to skirt local and state sales-tax through antiquated  precedent loopholes. eBay Marketplace sellers account for about 80% of eBay business.

Amazon, who is also not involved in the Supreme Court case, collects sales taxes on most direct purchases on its site, but does not collect taxes for items sold on its platform by third-party “Marketplace” vendors -- over 50% of Amazon sales.

Sales-tax is a consumption tax primarily purposed to a government to allocate resources. Sales-tax from online sales would add about $18 billion to affected states.

Who will pay the lost sales-tax?

Local businesses can’t compete when competitors don’t collect sales tax, and are already faced with a flood of China counterfeits, knockoffs and poor quality imports from Amazon and eBay, who escape liability for fake goods sales.

Why is the e-commerce business model being favored?

eBay claims they provide a platform for hundreds of thousands of commercial sellers with annual sales that exceeded $10,000, but were less than $1 million, yet eBay’s premise is that collecting sales tax is overly-burdensome to the small business sellers, citing a report that sellers spend at least five hours every month on regulatory compliance for their company.

The premise is false, and further peppered with claims that small online companies provide unique business opportunities for women, minorities, African-Americans, Hispanic, veteran business owners and people with disabilities, while fostering growth and employment in areas of the country that otherwise have suffered from economic stagnation. If so, they must do so honestly and responsibly.

Conspicuously absent is e-commerce sites collecting Marketplace sales tax for the destination location. After all, e-commerce sites profit from the sales and "The bigger e-commerce companies find themselves with a physical presence in all 50 states." stated Supreme Court Chief Justice John G. Roberts Jr.