While some may be aware of this fact, I was surprised today to see a 10% state sales tax on an auction house invoice that I received this morning. I called the auction house and spoke with a representative with whom I have a very good working relationship. She explained that the major auction houses are now required to collect state sales tax on winning bids as of June 1, 2019. The normal 25% addition of an auctioneers fee is included in the taxable amount. This tax rate will vary from state to state and is apparently tied to the delivery address for said item. In WA state I am paying 10% state sales tax on top of the 25% auctioneer's fee, so I got dinged with a total of 35% of the final hammer price added to the actual bid. In my instance this was additional $500 just for taxes that I had not anticipated. Just wanted to give folks a heads up on this recent change in pricing policy. It caught me off guard and, and I hope that others don't get bit by this same issue. Note that this change in policy applies to all of the US based major auction houses that we deal with on AML. Happy hunting and be aware of the potential sticker shock.

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Good post Tacoma , I was going to bring this up, glad you did , my state charges 7 %, so I am paying 32%, so that will change the way I bid on certain items , also Ebay has taxes depending on what state you live in and I guarantee you will see more private sales to avoid the sales tax , I have some Ebay friends tell me that their business is off because of the sales tax BS and they have to do deals off eBay to boost sales

so my question is to my fellow members , if you live in a state that charges sales tax on eBay or  your favorite auction house,  does that change the way bid on items, meaning you may not bid as much factoring the sales tax or you may not buy it now or even bid because of the sales tax?

I can tell you that this will absolutely make a difference in how I bid or if I even bid at all. I will occasionally pick up an item that I want but don't necessarily "need." Given the recent policy change I am going to limit any auction purchases to wish list, impossible to find only items (and there are less then 10 such items at this time - most of which I will probably never see). I will be going the route of private purchases for the vast majority of my collection from this point forward. I really hate going this path, but there is a tipping point for everything and this has gone over the line for me. I will not completely avoid the auction houses, but the item is gonna have to pretty damn special in order for me to be willing to pick up the new additional costs.

I made sure I bid lower then I normally would in a just recent auction knowing I am paying the 32% fee and that will continue until somehow this is BS tax is eliminated which means I will most likely avoid auction houses , eBay and just look for private sales 

If the auction houses were smart , they should think twice about the 25% or whatever fee , this BS sales tax is going to hurt their business, they should consider lowering the fee but allot of the houses would rather lose business then lower the fee to compensate 

i wonder if Ebay or even the auction houses had a chance to fight this or did they just lay down, I mean it’s going to hurt Ebay and auction house sales unless you live in a state that does not have the sales tax restrictions , but that’s only short term until the states figure out they are giving away revenue by not collecting sales tax 

Did I read that right? The Auction House is Charging 10% Tax on the Item and their 25% Commission too?? 10% Tax on the Total??

Tim: 

Yes. Based on the info I was told there is the hammer price plus the 25% auctioneers fee. Those two items are totaled to make up final sales price against which tax is charged. Let me be very clear that the 10% is WA state sales tax, my state of residence. State sale tax will vary by state so that 10% is not for everyone. Some states will have higher or lower sales tax the auction houses charge and other states may have no state sales tax. Kudos to the folks who live in those states with no sales tax as they are not going to to get hit by this topic. Those of us who do live in a state with state sales tax will now see that percentage added to the final sales price (hammer price plus auctioneer's fees). Hope that clarified things.

The previous auction at Rrauctions the results were pathetic! They charge the 25% on the sale plus the commission from the consignor which could be 15% depending on the deal you made with them. Does the buyer have to pay for shipping or us the part of the 25% fee? 

Plus the new tax!  Just outrages!

The buyer pays 25% buyers fee plus state sales tax and shipping & insurance 

This will hurt auction houses , let’s see who the 1st auction house will be smart enough to lower their fees to offset the tax , that auction house will win business , 

There's no state in the union that is 10% sales tax. I believe Tenn, at 9.45% us the top rate. National average is what? About 7 to 7.7%

Washington state sales tax = 6.5%. What are they sticking an extra 3.5% in their pockets by collecting 10%? Anybody ask? It's illegal to collect sales tax at a higher rate than is state prescribed. They should be reported to the state sales tax bureau, a complaint lodged. If they want to charge 10%, they shouldn't call it sales tax. It's illegal to do so. They should call it 6.5% sales tax and 3.5% highway robbery tax, or something like that. Report them. They're committing sales tax fraud, and the sales tax folks will go after them with a vengeance. They take an extremely dim view of that.

Woody2Shows: You are are correct in that the WA state sales tax by itself is 6.5% With local sales taxes tagged on, it can be up to 10.4% ( see https://www.avalara.com/taxrates/en/state-rates/washington.html). In any case, my tax was 10% which obviously includes local sales tax. So I got hit with state and local sales tax. I may have been somewhat inaccurate in my initial presentation of it being just state sales tax. Local sales tax based on my mailing address also applied. The general point still stands, however, that folks should be aware of the change in policy and possible extra sales tax depending on where one lives.

It's like a scene from Popeye with the Taxman.

this has been going on for a while some even sent out emails about it to buyers for states were exempt

also ebay will and has been doing it also

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