I had my first experience with Ebay charging sales tax on a sell I made yesterday. They added 7% to the invoice on a ancient coin sold to Rhode Island. I was not able to remove either. If I gave a discount for that amount, it would come from my side and the state would still get the 7%. Does not seem fair to the buyer. As far as I can tell that state does not collect sales tax on coins. Has anyone experienced Ebay collecting sales tax on coins?
An ancient coin is not a bullion-exempt sale. Sales tax should be charged. If online doesn't collect sales tax, that puts digital venues at an advantage over brick and mortar. They are not entitled to that advantage. And overtime, we would see more physical retailer be forced to shut down. However, items sold for the value of their silver, gold, or other precious metals should not be charged sales tax. As those items are an investment, and unless we want to tax the purchase of stocks or bonds, we should not tax the purchase of silver or gold. However, an ancient coin has numismatic value not based on the content of its metal, so it should be charged state sales tax not matter how it changes hands.
One of the bullion websites has this: https://www.bgasc.com/rhode-island-sales-tax-gold-silver-bullion-coins I see the website mentions there is tax on copper products. It might be the case that eBay has exemptions in place for bullion (gold, silver, platinum, palladium), but everything else they just lump into the taxable category regardless if it is correct (just to be safe and because it's probably easier that way).
Interesting. I thought eBay had successfully argued that, as a venue rather than a seller, they did not need to enforce tax policy. I know my state (NC) repealed its sales tax on bullion and coins a couple of years ago, but I don't know if there's ambiguity for ancients. Here's the Department of Revenue's take: I would think that the first category would include ancients, but I don't know for certain, and I don't know how other states interpret their exemptions. It's been a good while since I've tried to buy anything on eBay. I hope I don't get a bad surprise next time.
I experienced this firsthand the other day when a buyer from Washington State was charged sales tax, even though I do not live in Washington. I think that the recent Supreme Court case allowed states to begin taxing online purchases of all sorts, even if the seller does not have a presence in the taxing state. Confusing, though, because it's all a big patchwork of state laws at this point.
I've held a sales tax license in Colorado since 2003 and coins have always been except in the state whether they are 20 years old or 2000. I'm thinking Ebay's system is not smart enough to know what is exempt and what is not.
Well, if you get charged tax on a coin you're buying, or you sell a coin to someone in Colorado and they get charged tax, you'll know the system isn't working properly. But if you sell to someone in another state, it's the buyer's state that sets the rules.
Not that I sell on Ebay so I dont really care, but who is responsible for making sure the tax gets to the appropriate state? It would be a major hassle if the seller has to maintain 50 different tax accounts.
You probably think there are 50 states, each with a tax rate. Many cities and counties have their own sales tax rate. It is hard enough to know the rate for a zip code; who is to say which city and county sales taxes exempt coins. This 2018 blog post links to an 18 page tax table broken down by category and county in Arizona. http://coyoteblog.com/coyote_blog/2018/06/the-sales-tax-problem-for-small-businesses.html
eBay is collecting the tax and are responsible for sending it to each respective state (at least in theory).
Ah, here we go. This page lists a bunch of states for which eBay will start collecting tax automatically -- in fact, for most on the list, it already has, with a few coming in as late as this coming Oct 1. Oddly, my own state is not on the list. Yet. In the past I've bought lots that included sterling chains (which are taxable as jewelry) and coins (which are non-taxable). I think those lots were mostly listed under a Coins category. I wonder whether they would've been taxed, and if so, how? What about a gold eagle mounted in a gold bezel? (My local pawnshop says "jewelry, fully taxable". I say "pass, thanks.") I feel like this whole interstate-taxation scheme has been massively underthought. I expect a big mess, persisting for a number of years.
