Soldato
Basically HMRC seem to have implemented a policy of "taxing all foreigners living abroad".
Just imagine if all countries did the same. Chaos!
Just imagine if all countries did the same. Chaos!
Did Brexit kill AlieExpress?
- Thread starter =XDC=FluphyBunny
- Start date
They're taxing the purchases of people living in the UK.
Nope. They're closing a tax loophole.
Soldato
Exactly. So much hyperbole here. If you buy stuff, you pay your countries tax rates for buying stuff. It does not matter where you buy it from or it should not to provide a more level platform between the high street and the cheap labour online stores.
I'm assuming there is no change in consumer rights with respect to these aliexpress etc. imported products for which we are now paying VAT ?
the >20% price differential versus uk products helped offset thee risk of that chinese purchase, if the saving is now negligible, then the risk will not be worth it.
It's going to be a bonanza for Royal Mail profits as they select the illicit imports arriving and claim their £8 processing costs&vat.
the >20% price differential versus uk products helped offset thee risk of that chinese purchase, if the saving is now negligible, then the risk will not be worth it.
It's going to be a bonanza for Royal Mail profits as they select the illicit imports arriving and claim their £8 processing costs&vat.
Associate
Hard to tell what's due to COVID/logistics issues & what's a reaction to new UK specific policy, but if the UK is finally clamping down on VAT for imported goods from China & elsewhere then that's a good thing IMO. It was always a £5 gift wink wink tax dodge.
Edit - just checked some random electronic tat & it's all showing free/negligible shipping costs shipped from the China warehouse?
Edit - just checked some random electronic tat & it's all showing free/negligible shipping costs shipped from the China warehouse?
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Soldato
In theory every product should have a process mark whether CE, BSI or other internationally recognised testing system. Unfortunately children still die from burns in fancy dress, swallow loose parts, are poisoned by chemicals or paint systems. People take to the roads on illegal ebikes and escooters without a care protected by untested safety equipment. Your track car has some super cheap full race harnesses just like the real thing. Yes? You make your own choices in life but it is hoped that a closing of the price gap could reduce some of these hazards.
if they continue to post aliexpress stuff with the same customs labels / cn23 they currently have it will be a dead ringer for immediate courier inspection,
rm have an online system for paying shortfalls, so I think their costs are well controlled, with little pain for them.
Soldato
You don't need a tablet. Just a good dollop of Sovrenteee and some fish.
Soldato
Not sure it's a loop hole.
Surely it should work like this:
1) I buy something on a foreign website
2) I pay no UK tax
3) When it enters the UK it attracts import duty (UK VAT etc) according to whatever trade agreement the UK has with the foreign country
4) I pay that tax
What the UK is doing is passing that collection work onto the foreign company - it's fair that *I* pay the right tax, it's not fair that tax has to be collected by a foreign company.
Imagine of all countries did the same. I would need to register with *all* countries I sold stuff to, learn their tax rules and chaos would ensue.
The loop-hole is that the UK has not been checking imported goods for the correct import duties/tax simply as they don't have the man power for dealing with the billions of international business to consumer transactions that happen in a modern connected world. This is not the foreign sellers fault !
Don
Even when they do have CE marks. they can still be a crock of ****. My dad was wondering why his wifi was dropping 50% of it’s bandwidth recently. Tracked it down to a Chinese made LED Xmas lights on his tree. No way it was EMC compliant, but was marked up right with CE marks.
He was gutted, been trying to shop ethically for a couple of years now, but it can be nigh on impossible. Even big manufacturers have out sourced manufacturing to there.
Soldato
Imagine if all sellers were legit and pricing their goods accurately on the package, not aiming to evade tax or duty.
The EU believes up to €5bn each year is lost through fraudulent practices such as these. It is bound to happen.
It's a loophole all right, caused by HMRC's inefficiency.
Soldato
will they close the same tax loops that the Tory toffs like JRM and the rest of their wealthy donors use to avoid apying tax in the UK also, or this this just a case of lets smash the little people because that's easy and they don't donate money to us to keep us in power ?
They need to go for the big ticket items, not scrubs buying chinese tat from AliExpress, but as usual they won't have the balls to take on their own donors.
As far as I'm aware this is already the case but there use to be a threshold of £70,000 before you had to register for VAT in the UK. Each EU member has its own threshold and rules, for example in France/Spain/Italy its €35k, Germany €100k. These are all coming into line in June? this year and the thresholds will 10k for everyone, and they will have a system in place to actually track this now. The benefit for the EU being its all one reporting system now.
This is just what i have garnered trying to anticipate how my business charges vat for our EU sales and tbh i was pretty unaware of some of these obligations, as i image most businesses were. I think anyone who sells any reasonable volume to the UK is probably aware of this and its just the small businesses with exports under the threshold that are now surprised by this
Soldato
This was done for one reason, and one reason only. To avoid building more customs infrastructure. It's that simple.
What are they going to do when a company collects the VAT and doesn't pay it to HMRC and decide to keep it for themselves as a nice 20% bonus?
What are they going to do when a company collects the VAT and doesn't pay it to HMRC and decide to keep it for themselves as a nice 20% bonus?
Don
The proper one. It even had the appropriate EN numbers as well.
It is/was a legal requirement to have CE marking and compliance to sell that item in the U.K.
Soldato
I think Borises actually want to offload the collection at the point of sale on a UK outlet.
Now, this would kind of work if it was still 1950ies of the last century, but the way we do retail changed since then. Many major outlets are just handlers or drop shippers.
So - let's say I manufacture oak wood computer cases somewhere in the forests of Germany. Because I prefer full control over retail prices for my boutique product rather than wholesale I manage all my sales outlets by myself. Today I want to sell ten of my cases, worth £200 each via Amazon to UK customers. I'm already DE VAT payer, but EU VAT exchange no longer works within UK. Today I have to register for UK VAT number with HMRC and two EORI numbers, one for Europe and one for UK.
Once I ship my oak PC cases over to Amazon UK, using my GB VAT number and UK EORI, the moment my 10 cases arrive in Kent depo I am liable for £400 of UK VAT, which Amazon has to immediately collect and pay over to the HMRC. Keep in mind that this VAT is on top of the declared value of my merchandise, not my actual sales or earnings less Amazon fees. Any tiering of prices or volume discounts will no longer be possible to my Amazon UK customers because I have to know the sale price right here, right now and declare it to HMRC straight away. I also don't think it's yet clear if Amazon will provide me with line of credit or some other arrangement, but obviously in the worst case scenario it involves international money transfers before I actually make a sale. After each of my cases actually sell on Amazon Prime, and selling fees are deducted, I will also have to register my sale with DE VAT, and pay that to my taxman. And then I guess, somehow try to deduct UK VAT as a "cost of sale", but because there is no existing mechanism to offset one against the other - who knows at this point. In short - whichever way I take it - each item from my made up German company shipped towards UK generates: custom form, pre-emptive/pre-sale VAT invoice, me owing 20% straight away to HMRC, someone collecting it for me, and then the usual chain of taxes inside of my own country.
So, right from the get go, my best bet to stop bleeding money into multiple VAT chains and freezing both assets and money upfront for months is to stop exporting to UK. Stop shipping anything to Amazon UK immediately and not to sell anything to UK customers via web with direct shipments. Which is something we are going to see literally within days this week.
Instead, just as my grandfathers did before me, I'd have to wait for some importer from UK to come to me, buy my product and physically take it away to UK customers. Obviously I would have to sell to that importer at a retail price I used to charge, because why would I earn any less. Right? That way I only pay DE VAT as if it were local sales and UK importer handles all the unregulated mess of bureaucrats from London (see what I did there?) on their own. However, because the chain is back to what it was 100 year ago - my product is immediately at least 20% more expensive to UK customers - as UK retail price is on top of the DE retail price + DE VAT, plus whatever handling fees. But how is that my problem as a fantasy German oak PC case manufacturer?
So, you see, this isn't a free trade agreement of any kind. It only gives us no customs duty. This free trade agreement is not a Swiss scenario nor Norwegian scenario. It's not even Andorrean scenario. It's a caravan of merchants scenario. It's how trade is done with Borat in some Kardashianstan.
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