The Canadian province of British Columbia is now taxing virtually all fees ecommerce sellers pay to marketplaces like Amazon, a move that could significantly increase operational costs and complexity for online businesses. This episode breaks down the Online Marketplace Services Act, explaining why this new provincial sales tax (PST) on seller fees is flawed and what ecommerce operators need to know to navigate these changes and ensure compliance, especially if selling globally from BC.
Key takeaways
BC is now applying Provincial Sales Tax (PST) to nearly all Amazon seller fees (storage, fulfillment, advertising, commissions), not just customer purchases, drastically increasing the tax burden on ecommerce operators.
Amazon has historically taken a conservative approach, collecting PST on sellers' global sales since 2021, meaning many BC sellers already pay 1-2%+ of revenue in PST, a figure now set to rise with the new fee taxation.
Ecommerce sellers with a presence in British Columbia must review their fee structures and understand the new PST implications on marketplace fees to ensure compliance and avoid potential penalties or audits. Professional legal or accounting advice is highly recommended.
The Online Marketplace Services Act specifically targets the taxation of online marketplace services, making it critical for sellers to understand its direct impact on their operational costs in BC.
The new tax regime could inadvertently lead to double taxation or disproportionately higher tax burdens, especially for small businesses operating within or selling from British Columbia.
Dave interviews David McCormick from Legacy Lawyers to talk about e-commerce taxation in B.C., Canada, specifically regarding the Online Marketplace Services Act, the Ministry of Finance's choice to start charging Provincial Sales Tax (PST) to every B.C. based seller on each of Amazon's seller fees, and why this choice is ultimately flawed. Let's be real - email marketing isn't flashy, but that's what makes it great. Who needs chaos when you can have steady, reliable results? That's where Omnisend email and SMS comes in. Check it out today and use code ECOMCREW. E-commerce taxation is a huge mess in British Columbia right now. If you're not from the great white north, then you should know that Amazon has been charging sellers PST since 2021 – something that Amazon wasn't exactly required to do. The worst part? They've been charging this on sellers' global sales—whether those sales occurred in Canada, the United States, or Brunei Darussalam. Because of this, many BC sellers have been paying a minimum of 1% of their sales (and most will be closer to 2% or greater) in provincial sales tax (PST). The Big Takeaway: Provincial Sales Tax (PST) is being applied to fees paid by sellers, and not just customer orders. While Amazon has taken a conservative approach to PST co
Frequently asked about this episode
What does this episode say about amazon & marketplaces?
BC is now applying Provincial Sales Tax (PST) to nearly all Amazon seller fees (storage, fulfillment, advertising, commissions), not just customer purchases, drastically increasing the tax burden on ecommerce operators.
What does this episode say about finance & fundraising?
Amazon has historically taken a conservative approach, collecting PST on sellers' global sales since 2021, meaning many BC sellers already pay 1-2%+ of revenue in PST, a figure now set to rise with the new fee taxation.
What does this episode say about amazon & marketplaces?
Ecommerce sellers with a presence in British Columbia must review their fee structures and understand the new PST implications on marketplace fees to ensure compliance and avoid potential penalties or audits. Professional legal or accounting advice is highly recommended.
What does this episode say about amazon & marketplaces?
The Online Marketplace Services Act specifically targets the taxation of online marketplace services, making it critical for sellers to understand its direct impact on their operational costs in BC.
What does this episode say about amazon & marketplaces?
The new tax regime could inadvertently lead to double taxation or disproportionately higher tax burdens, especially for small businesses operating within or selling from British Columbia.
