Ebay + Gst

[Skid_MacMarx]

Tax sniffs eBay seller detail

Chris Jenkins

MARCH 13, 2007

THE head of the group representing eBay's biggest Australian sellers expects the online auction site to be forced to register as an Australian entity and begin paying GST.

EBay handed over to tax officials yesterday the details of hundreds of its largest merchants.

Phil Leahy, Australian head of the Professional eBay Sellers Association, said eBay should be registered as a local business for tax purposes.

"It's only fair that eBay be paying tax in this country," he said. "The law has to be examined."

Mr Leahy said the association had taken legal advice on GST issues and had discussed the matter with the Australian Tax Office.

"We are taking steps to get some clarification," he said.

Mr Leahy said he was confident eBay's Australian operation would follow the lead of its British counterpart, which was forced by Britain's Inland Revenue Service to pay Value Added Tax.

"That was basically sorted out overnight, and you now have a situation where eBay pays VAT on all its invoices," he said.

"I'm sure that common sense is going to prevail over this issue."

Yesterday, eBay emailed about 1000 Australian sellers who had annual turnover of more than $50,000, telling them that in response to a request from the ATO, details of their memberships and dealings on eBay had been passed on to tax officials.

Data the ATO asked for covered the tax years from 2003-04 to 2005-06, and included members' contact names, sellers' user names, telephone numbers, duration of membership and monthly sales turnover.

The ATO declined to comment on the nature of its inquiries, but the email to sellers included a link to eBay's GST policy.

The last time the ATO asked eBay for seller data was in 2004.

The auctioneer's Australian business is run from Switzerland by eBay International, and as a foreign entity it does not collect GST.

It is understood, however, that up to half the local eBay sellers registered for GST have claimed input credits from the ATO, believing invoices from eBay had included GST.

EBay had provided the data to the ATO in accordance with its own privacy policies, Australian managing director Simon Smith said. The company had "no basis to assume that people had been deliberately avoiding tax", and eBay had advised its sellers to get professional tax advice.

Nevertheless, Mr Smith said, tax issues were the sellers' problem and any claim by sellers that eBay had not made clear that GST was included on its invoices was an attempt to "shift the blame" to it.

EBay had never claimed that GST was charged on its invoices, and any eBay seller who attempted to avoid tax was "foolish", he said. Large eBay sellers claim they are easy targets for tax officials, but say smaller sellers could undercut them by not collecting GST, knowing they less likely to be hit by the tax office.

Having eBay registered locally would allow Australian sellers to legitimately claim input tax credits for GST, Mr Leahy said.

Seller Donna Kelly said she welcomed the move.

"I have always been straight with my figures and if it is going to stop the ratbags out there who aren't registered for GST, it's a good thing," she said.

As long as eBay gave the tax office accurate records, she had no problem, Ms Kelly said.

She was confident her own business was in the clear, but GST issues did cause confusion among sellers, she said.

Mr Smith said eBay would consider revising its stationery to make it clear that it did not collect GST on its invoices.

http://australianit.news.com.au/articles/0...5E15306,00.html

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http://australianit.news.com.au/articles/0...5E15306,00.html

Just heard an interview on news radio about this Skid; apparently 17,000 aussies use e bay as their primary source of income