So 1/6 scale stuff will cost more for them?
A few different scenarios are going to play out. They are attempting to force any business that sells as little as one UK bound order at or below the 135 GBP threshold to register in the UK to collect VAT at the time of sale, remit, and establishes a 6 year liability for said taxes as well as potential fines related to collection and declaration. This flies in the face of how such matters are handled normally as you would normally only require this of large online marketplaces, companies with a physical presence/nexus in the destination country, or companies that meet appropriate thresholds demonstrating they have the time and resources to administer such tax collection programs.
Basically they are doing this to shift the cost of collecting the tax to small businesses, as most customs agencies have done internal studies where their break even point for collecting sales tax on postal imports is usually north of $100. Sales over 135 GBP don’t require the seller to collect the tax and follow standard procedures where the courier brokers a shipment or Royal (hah!) Mail does in the case of a postal shipment so that is illustrative of the motivation for this.
You will likely see a lot of businesses elect to not to ship to the UK through their own websites as the way this has been implemented is a mess with a value based threshold that activates tax collection. Many are not going to want to juggle multiple currencies nor want to deal with tax liability issues. Other businesses may opt to limit UK sales to products over a given price point or to online marketplaces instead which will mean higher costs for the UK consumer as additional costs are passed along. In practical terms this is more of an issue for UK consumers that make international purchases below 135 GBP as they will see their base costs go up and selection of places to shop diminished in general.
Oh, that seems unfortunate for them. Well, I know where I’m not moving to now, that’s for sure.
More grasping officiality, seems to be a lazy, ill-considered action. Feels like it is putting the burden on individuals like a friend of mine, who cobbles together his pennies, to continue hobbying.
Certainly a world’s first to make the entire planet responsible for collecting sales tax for a country.
For hobbyists selling some of their bits on to UK acquaintances ensure you mark your packages as gifts (rather than merchandise) and use your personal name.
The EU will be enacting similar changes starting on July 1. Everything sold into or within the EU will be subject to VAT and previous exemptions will be gone. Their measures are slightly more sane than what has been enacted in the UK but starting from that date all packages with business to consumer goods showing up in the EU will be taxed at the postal or courier level if a business hasn’t already charged the VAT at the time of sale. Any marketplaces, large platforms, and bigger businesses will charge VAT at the time of purchase.
What the hell. Even inside the EU. These greedy people start to be really annoying. I guess this will be VAT plus some hideous fees on top. Funnily, I have no chance at all to buy in my own country, so this is solely bad news to me.
So avoid by having it sent by a friend?
Guess, I will start buying tons of backlog then before that date.
You would have to check for further details but it seems like they are eliminating all previous threshold-based exemptions. The idea is that current VAT rates are applied uniformly for all orders from abroad. If you buy something, somewhere in the world, they want you paying VAT. If you are currently charged a “handling fee” by the postal or courier service to broker your package through customs and collect VAT then I would imagine that would just carry on unchanged.
For Germany only
This is highly retarded if I may say so. I can’t quite understand exactly what they mean. Seems like no taxes within the EU, but they express themselves in such a way that it implies as well that this applies to all sent packages even inside the EU.
They mention that everything imported in the EU is subjected to be taxed, but another paragraph states that every package needs to be registered with the customs…
EU distance selling thresholds that govern when an EU business has to register to collect and remit VAT in other EU countries have been dramatically cut. In practice any real EU business (10,000 EUR or more annual turnover) will have to collect and remit the VAT applicable for the customer’s EU country. Any intra-EU sales will be taxed at the VAT rate of where you live as an EU customer. They don’t want any competition within the EU based on a tax advantage.
The zoll link just explains the old 22 EUR VAT exemption is now gone and all postal imports have to be declared through an electronic system (postal operators should already be exchanging this information). Postal/Courier imports under 150 EUR can be sent by the shipper as VAT prepaid if they are registered for this IOSS VAT reporting system or they can be cleared by the postal service or courier as happens normally now, hence them requiring electronic customs declarations to identifying the classification of the goods to simplify the process for them. Imports over 150 EUR have to be assessed for VAT by the postal service or courier.
Well here in Korea, duty is to be paid if over $150. $150 or under, no tax. With e-bay buys, no other information needed. But other sites such as ali-express, etc… your social security number or passport number is needed…which is kind of a pain.
For all EU buyers as well. Remember, getting in all the backlog this month if funds are sufficient. From July on it might become a chore to import non-EU things. However, we need to see though if workarounds etc are feasible and how the whole importing precedure will hold up eventually.