Discogs tax starting today!

Discussion in 'Marketplace Discussions' started by Strat-Mangler, Jul 1, 2019.

  1. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    Ah yes, that's right. I read that on awhile back, I think on a Discogs thread, and totally forgot about it. I thought it was just a rumour at the time.

    It's a shame they are doing it that way actually because under the current method the seller doesn't get the cash and hence doesn't lose out on the portion that Paypal takes (which is what happens on Discogs). I wonder why they decided to change it.

    I think pretty soon you'll see most states doing this and more countries to follow.

    With all the changes with these tax rules and the postage rates, it's becoming increasingly difficult for me to justify selling online for anything but high value items. Items on the lower end of the value spectrum require just as much work as those that are higher in price and sometimes it really isn't worth the effort. Throwing them away is very appealing at times!
     
  2. R. Totale

    R. Totale The Voice of Reason

    I got a more clearly worded Paypal email this morning, and realized I misunderstood the eBay email. It appears that in cooperation with Paypal they will not be passing the tax through to the seller and recovering it as Discogs does. They (Paypal mostly) will just capture and remit it to the various states.
     
    eddiel and Matthew Tate like this.
  3. Strat-Mangler

    Strat-Mangler Forum Resident Thread Starter

    Location:
    Toronto
    The law passed a few months ago. AFAIK, every online business is now required to collect tax.
     
    Matthew Tate likes this.
  4. hobbes4444

    hobbes4444 Forum Addict

    Location:
    Massachusetts
    This s**ks. Being taxed on a purchase from a fellow collector is ridiculous. Hopefully enough people complain to their state reps to get states to exempt low volume sellers in some fashion.
     
    Strat-Mangler, Dave and Matthew Tate like this.
  5. Dave

    Dave Esoteric Audio Research Specialistâ„¢

    Location:
    Greater Vancouver
    Really, and what the Hell's next collecting tax at yard sales? :rolleyes: :wtf:
     
    Matthew Tate and Strat-Mangler like this.
  6. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    This really only affects states that have passed Marketplace Facilitator laws, but quite a lot of states have passed these types of laws. Amazon has a handy list: Amazon.com Help: Marketplace Tax Collection
     
  7. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    You know what in NYS state, unless your yard sale meets the special exemption rules for garage/yard sales, you may indeed need to charge tax and possibly even register. Now whether they can enforce that is another question. But those appear to be the rules.
     
    Matthew Tate likes this.
  8. hobbes4444

    hobbes4444 Forum Addict

    Location:
    Massachusetts
    MA must be one because I'm getting hit with tax on everything, even a purchase from the UK. That just boggles my mind, though I understand it in the context of the Supreme Court decision. So much for a conservative court. Just keep taxing like the liberals;)
     
  9. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    Yes it is.

    I suppose it was inevitable considering how much money is changing hands and the loss of tax revenue to each state.

    Up here in Canada we've been used to getting hit with sales tax when items cross the border. But what's different about these new rules in the US is that it puts the onus on the seller/market place facilitator to collect and remit the tax. In Canada it's up to Customs to intercept, assess and charge the appropriate tax which is then collected by the carrier who makes the delivery. In addition, there's a small exemption, whereas in these states there is no exemption at all, everything, regardless of value, is taxable (as long as it's a taxable good/service).

    I imagine it won't be too long before Canada does something similar at least at the federal level.
     
  10. Strat-Mangler

    Strat-Mangler Forum Resident Thread Starter

    Location:
    Toronto
    34/50 is a huge portion!
     
    eddiel likes this.
  11. Strat-Mangler

    Strat-Mangler Forum Resident Thread Starter

    Location:
    Toronto
    To be fair, most (all?) of the online purchases I've made have been taxed. I guess the only thing left is using eBay in Canada and buy from a Canadian seller. I believe that purchase would not be taxed, yet.
     
  12. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    For sure and it includes states with big markets too. This really is a bad development for online sellers like me though. I'm a part timer and basically sell as part of my hobby (of buying records). Selling to the US is already difficult due to the high postage rates (well difficult even within Canada due to high postage rates!) and the sales tax just increases the prices even further, which likely means I'll need to lower my prices and hence my profits. In many cases, it's already easier to just sell locally to a store or at record shows. I expect these changes will make it even less attractive to sell online, for me anyway.
     
    Strat-Mangler likes this.
  13. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    Yeah our sales tax rules are different so there would be no tax unless the seller is actually required to register for sales tax (ie meets the threshold in their province). There's no marketplace facilitator laws up where so sellers on eBay and Discogs would be considered separate sellers and not one big seller.

    Not sure how long that will be for there. There's talk of adding sales tax to Amazon Prime, Netflex and other streaming type services soon, which was always going to happen at some point.

    I usually escape sales tax on most of my purchases. Even some expensive ones get by sometimes.
     
  14. yesstiles

    yesstiles Forum Resident

    Am I expected to collect taxes when I sell a cd on Discogs?
     
  15. eddiel

    eddiel Forum Resident

    Location:
    Toronto, Canada
    No but sort of...for any state that passed the market place facilitator law, Discogs will automatically add the tax to the invoice you issue to the buyer. When the buyer pays you, he also pays you the sales tax. But Discogs will then bill you for that sales tax when they bill you for their other monthly fees. Discogs then remits the tax to the state in question.

    It does mean that you lose out on the Paypal fee portion of the tax amount as Paypal deducts their fee on the total you receive and Discogs bills you for the full amount due.

    Discogs does give you the option to bar sales to any state that requires them to charge sales tax. But you'd be blocking yourself from a large part of the US market if you did that and in time I imagine most states will pass similar laws.
     
    Matthew Tate and yesstiles like this.
  16. cdash99

    cdash99 Forum Resident

    Location:
    Mass
    Living in the state we both live in, do you think that will ever happen? There's never enough.

    I'd go on, but that would violate the rules of SHF.
     
    Matthew Tate likes this.

Share This Page