topic Re: Double the GST on some items? in Selling

Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 01:35:05 GMT

Now that the government has waited before introducing the tax they now also get the FVF's for the postage

component.

If you sell an item for $10 with $10 postage they are actually getting 20% gst,(10% on each).

You are not selling postage but it's still regared as a FVF,

So you have to start charging more for the item and more for the postage if you want the same "profit" for

whatever you sell.

It's difficult enough to sell items on this site as buyers aren't willing to pay the same prices that they paid in

the past,(if prices go up it will become even more difficult).

Or absorb the fees and make less "profit" which in turn could mean buying less on this site,

Re: Double the GST on some items?

lyndal1838 — Fri, 02 Jun 2017 02:54:55 GMT

There is no GST on the item cost....just the ebay fees. And I am sure I read somewhere that the GST will be charged on the fees less any postage you have paid.

Any GST on the item will be paid by the seller if they are registered for GST.

Re: Double the GST on some items?

gec2002 — Fri, 02 Jun 2017 03:19:42 GMT

@go-tazz wrote:

If you sell an item for $10 with $10 postage they are actually getting 20% gst,(10% on each).

Sorry but when working with Percentages you can't just add them.

@If your $10 item has GST @10% = $1 and your Postage of $10 has GST at 10% that is another $1 = Total 1+1 = $2
Toyal Cost $10 + $10 = $20 including $2 GST $2 0f $20 is 10% not 20%

Now if eBay start charging GST it will be on the fees not the cost of the items. So in the above example if FVF is 10% just to make the sums easy then FVF on $20 (as eBay include postage) would be $2 (10% 0f $20) then there would be GST on $2 fee of 10% = $0.20

so your fees would go from $2 to $2.20. The GST component can be claimed in your BAS statement and the remaining as a cost.

Re: Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 03:20:46 GMT

eBay will get FVF's on the item sale price and the postage cost.

So in my example eBay get 9.9% FVF's on the sale price and the postage cost,(99 cents and 99 cents).

Total $1.98 and the tax will take 10% = 19.8 cents,(9.9 cents for the item and 9.9 for the postage).

Thereby doubling their GST to 20% even though one item,(postage) isn't a "sold" item.

We don't sell postage so this part of their GST grab is them acting as bad as eBay did when they first started

charging on the postage,

Re: Double the GST on some items?

lyndal1838 — Fri, 02 Jun 2017 03:34:12 GMT

No Tazz...the GST is not on the item cost but on the fees that ebay charge you to sell the item.

And you will not be charged GST in the postage you have paid as it is already included in the postage paid to Australia Post.

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 04:08:35 GMT

I saw clarification that no gst is payable on the postage component.

It was in an ebay email somewhere.

Might try to find it.

Re: Double the GST on some items?

collect247 — Fri, 02 Jun 2017 04:40:51 GMT

If sellers are starting to worry about the GST on items then everyone should look at their every day life that involves the GST.

There are many many things that you pay for which you get charged 20% GST instead of 10% GST.

One example is when you put your car in to get serviced/repaired and the repairer gives you the bill which will have the labour cost and the parts cost total then GST added to give the final cost.

But what people don't see that's hidden in the cost is that you are being charged twice for the parts lol.

When the parts are purchased they incur the GST and then the repairer charges the GST again in the bill so you're paying 20% on the parts.

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 04:47:28 GMT

Can't find it, but trust me - I'm a stalker lol

Tazz, by your example, if you sell something for $10, ebay's fvf is 99c. (9.9%)

The gst component is only 10% of that 99c, so it will only add up to $1.09

Just pretend the fvf has gone up to 10.9%

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 04:50:44 GMT

@eezipeezi888 wrote:
If sellers are starting to worry about the GST on items then everyone should look at their every day life that involves the GST.
There are many many things that you pay for which you get charged 20% GST instead of 10% GST.
One example is when you put your car in to get serviced/repaired and the repairer gives you the bill which will have the labour cost and the parts cost total then GST added to give the final cost.
But what people don't see that's hidden in the cost is that you are being charged twice for the parts lol.
When the parts are purchased they incur the GST and then the repairer charges the GST again in the bill so you're paying 20% on the parts.

Nup. Sorry Eezi. The repairer pays the gst when he purchases the parts.

(Mind you, the bill is padded so much, you might as well be paying it.)

But it's what they call Value Added Tax in the UK

Each step has the gst added

Re: Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 05:04:00 GMT

@lyndal1838 wrote:
No Tazz...the GST is not on the item cost but on the fees that ebay charge you to sell the item.

Where have I stated that it's on the item cost?

I've stated that it's on the FVF,(Final Value Fees) that are charged by eBay once you sell your item.

As sellers will incur the 10% GST they have to take that into account when selling their items.

At present if you sell an item it is charged at 9.9 %,(that's 1.98 for my example).

Once the GST comes in there will be an additional cost of 19.8 cents for the GST,(for the item sale price

and the postage charge).

Therefore IF you want the same profit you have to charge extra.

And you will not be charged GST in the postage you have paid as it is already included in the postage paid to Australia Post.

As I read it hat only refers to the postage component if you use eBay postage labels.

It does not cover the postage that a seller charges the buyer,(as it's included as a FVF).

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 05:13:30 GMT

Geez, Tazz, you're doing a great job of confusing yourself.

Read back. My post should clarify

Re: Double the GST on some items?

lyndal1838 — Fri, 02 Jun 2017 05:18:58 GMT

@eezipeezi888 wrote:
If sellers are starting to worry about the GST on items then everyone should look at their every day life that involves the GST.
There are many many things that you pay for which you get charged 20% GST instead of 10% GST.
One example is when you put your car in to get serviced/repaired and the repairer gives you the bill which will have the labour cost and the parts cost total then GST added to give the final cost.
But what people don't see that's hidden in the cost is that you are being charged twice for the parts lol.
When the parts are purchased they incur the GST and then the repairer charges the GST again in the bill so you're paying 20% on the parts.

No, you are not being charged twice for the GST on the parts. The repairer would have claimed an input tax credit when he did his BAS.

The GST gets claimed as in input tax credit all the way up the line till it gets to the end consumer.....it is only paid once on all goods.

Re: Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 05:33:42 GMT

@imastawka wrote:
Can't find it, but trust me - I'm a stalker lol

Tazz, by your example, if you sell something for $10, ebay's fvf is 99c. (9.9%)

The gst component is only 10% of that 99c, so it will only add up to $1.09

Just pretend the fvf has gone up to 10.9%

All my examples are if GST is payable on the postage component of the FVF's,(so it's exatly the same as yours

but for the GST only).

As stated in post number 4

So in my example eBay get 9.9% FVF's on the sale price and the postage cost,(99 cents and 99 cents).

Total $1.98 and the tax will take 10% = 19.8 cents,(9.9 cents for the item and 9.9 for the postage).

Re: Double the GST on some items?

digital*ghost — Fri, 02 Jun 2017 05:39:58 GMT

My impression of the statement that postage will be excluded from GST was only when you purchase postage services via eBay, so that buying a label won't have any added, but the FVF charged on the postage component will.

Tazz, the simplest way to work it out is to consider the fees charged on sale price and postage amount as a single figure.

Eg item cost $10 with postage cost $10. Total sale price $20. FVF on $20 is $1.98.

GST on $1.98 fees is 20c so total cost on invoice would be $2.18.

Re: Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 05:38:55 GMT

@lyndal1838 wrote:
No Tazz...the GST is not on the item cost but on the fees that ebay charge you to sell the item.

And you will not be charged GST in the postage you have paid as it is already included in the postage paid to Australia Post.

My opening post is probably badly worded but the opening statement did say

Now that the government has waited before introducing the tax they now also get the FVF's for the postage

component.

Meaning that before it would've only been GST on the item FVF's and now it's also on the FVF's postage

component.

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 05:39:30 GMT

I'll type slowly so you can understand.....

T h e r e' s n o g s t o n t h e p o s t a g e c o m p o n e n t

$10 sale incurs 99c fvf + 9c gst = $1.09 (rounded up)

NOT $1.98

Re: Double the GST on some items?

go-tazz — Fri, 02 Jun 2017 05:47:48 GMT

There seems to be confusion by others as nowhere have I stated total fees payable,(yet that's the mistake

I'm making?).

I'm only stating the GST component of the FVF's if postage is included in the FVF's GST,(which is 9.9 cents

for the postage FVF's on a $10 item),

Re: Double the GST on some items?

imastawka — Fri, 02 Jun 2017 05:50:27 GMT

My bad.....forgot the fvf on postage (not GST)

Re: Double the GST on some items?

fred_foofighter — Fri, 02 Jun 2017 06:39:19 GMT

Well if your worried about GST on the GST that is included in the postage (A Tax on a Tax) because it already has had GST incorporated into the price, then you should also be worried about the GST on the GST that is included in the price of the item that the seller is selling.

As Lyndal said "The GST gets claimed as in input tax credit all the way up the line till it gets to the end consumer.....it is only paid once on all goods."

Re: Double the GST on some items?

digital*ghost — Fri, 02 Jun 2017 07:27:37 GMT

@go-tazz wrote:
There seems to be confusion by others as nowhere have I stated total fees payable,(yet that's the mistake

I'm making?).

I'm only stating the GST component of the FVF's if postage is included in the FVF's GST,(which is 9.9 cents

for the postage FVF's on a $10 item),

Your opening post refers to total fees payable, because as I understood it you were explaining that GST will be charged on both components of eBay's FVF, which is charged in two parts, FVF on sale price, FVF on postage amount, which is where I assumed the 20% GST figure came from (adding the 10% of one to the 10% of the other, but that's actually erroneous - very few items on the site would have P&H equal to their purchase price, if I sell a $50 item with $2 postage, the GST component on the subsequent fees would be no more than 50c on the sale price, and 2c on the postage, hence why it is easier to look at the sale total, or rather the fee total, then calculate GST, fewer sums, less room for error).

I'm not saying this as an attempt to explain things to you specifically, I'm just trying to find the simplest way to summarise what is actually going to happen (in so far as I understand it).

10% GST will be added to all of eBay's service fees.

eBay's Service fees are:

Store subscription fees

Insertion fees

Final value fees (combined)

Listing upgrade fees

Selling Manager Pro subscription fees (where applicable)