Sales Tax and eBay Fees: What Sellers Need to Know

Sales tax confuses a lot of eBay sellers. eBay collects it, you never get to keep it, and yet it affects your fees. This guide explains how sales tax works on eBay US sales, how it changes your fees and profit, and how to handle it in your calculations. Examples use US rates from our calculator, last checked on September 25, 2026.

This article explains how sales tax interacts with eBay fees. It isn't tax advice; for your own situation, speak to a qualified tax professional.

Who collects sales tax on eBay?

In the US, eBay acts as a marketplace facilitator. That means eBay calculates sales tax at checkout based on the buyer's location, collects it from the buyer, and sends it to the relevant state. In most cases, you as the seller don't need to collect or remit sales tax on your eBay sales yourself.

The tax the buyer pays shows on your order details, but it isn't part of your earnings. It passes through eBay to the state.

Does eBay charge fees on sales tax?

Yes. eBay's final value fee is calculated on the total amount of the sale, which includes the sales tax the buyer pays. So do Promoted Listings ad fees and the international fee.

Example: a $100 item with free shipping, in most categories, no Store.

The $8 of tax costs you $1.09 in extra fees, even though you never receive the $8.

How to handle sales tax in your calculations

1. Include tax in the fee calculation. Multiply your final value fee rate by the item price + shipping + tax.
2. Exclude tax from your revenue. Your revenue is the item price plus the shipping you charged, nothing more.
3. Estimate tax if you don't know it. You won't know the buyer's location in advance. For planning, use a typical rate for your buyers, or leave it at zero and accept the small difference.

Our US eBay fee calculator has a separate sales tax field and handles both rules automatically: tax is included in the fee base but not counted as revenue.

What sales tax means for your pricing

In most categories, every $1 of sales tax adds 13.6 cents to your fees. For most items that's small, but it adds up across many sales, and it matters for low-margin items. If you work to tight margins, include a typical tax amount when you use the pricing formula in how to price items on eBay for profit.

Income tax is a separate question

Sales tax is paid by the buyer. Income tax is about the profit you make, and it works differently:

• Your eBay profit may be taxable income, depending on whether you're running a business or selling personal items for less than you paid.
• eBay may issue tax forms (such as Form 1099-K) if your sales meet the reporting thresholds that apply for the year.
• eBay fees, postage, packaging and the cost of goods are generally business expenses, so keep good records of all of them.

Tax rules and reporting thresholds change, so check with a tax professional or the IRS for current guidance.

Outside the US

• UK: business sellers pay 20% VAT on eBay's fees, which our UK calculator includes. If you're VAT registered, you may be able to reclaim it.
• Australia: eBay Pro fees include 10% GST, unless the account has approved tax-exempt status.
• Canada: tax collection on marketplace sales depends on the province and the seller's registration. Check eBay.ca's tax pages and a local adviser.

Key takeaways

• eBay collects and remits US sales tax on your sales as a marketplace facilitator.
• You pay the final value fee on the tax, but the tax isn't your income.
• Include tax in the fee base, exclude it from revenue, and your numbers will be right.

For more on what goes into the fee base, see final value fees explained and how shipping affects your eBay fees.