Read on Twitter
Thread: On 1/1, @uk_domain_names posted on the dilemma of a Dutch bicycle shop selling spares to UK customers by post/courier. (1) https://twitter.com/uk_domain_names/status/1345149939064713217?s=20
And the new regulations governing supplies from Overseas (except they're not regulations, just a 'hold your breath and make wish' from @HMRCgovuk )
https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021 (2)
https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021 (2)
First of all, let's dispose of ...but Amazon and EBay brought this in weeks ago. Let's be clear, their business is E-Commerce. The bike shop's business is selling bike parts, some of which involves e-commerce. It's apples and pears. (3)
The bedrock of a successful tax is simplicity and certainty. HMRC's solution is neither. First of all, there can be no controls on compliance, secondly, it transfers a risk of fraud to EU VAT authorities which did not exist before. (4)
Were this being done to the UK by one of the 27, my response as Govt would be 'jog on'.
And while there's nothing to stop voluntary VAT registration by an overseas company, my 2nd response would be ' you can do it but we won't allow zero-rating of your sales'...(5)
And while there's nothing to stop voluntary VAT registration by an overseas company, my 2nd response would be ' you can do it but we won't allow zero-rating of your sales'...(5)
...because that's where the potential for fraud arises, which the EU VAT authority would have no means of controlling.
So I would disincentivise registration for UK VAT. Let's say I am that Dutch bicycle shop, what would I do? (6)
So I would disincentivise registration for UK VAT. Let's say I am that Dutch bicycle shop, what would I do? (6)
Nothing I didn't do before (well, a disclaimer on my website). I'd charge the same price to UK buyers as I do to EU customers, inclusive of Dutch VAT. I certainly wouldn't register for UK http://VAT.My disclaimer would be that.... (7)
....the UK customer is responsible for any addt'l admin or taxes levied by UK.
But in that respect have you ever purchased goods from a 3rd Country (as EU now are)? I bought a Playstation direct from Japan. I expected it to arrive with Customs handling charges and tax.(8)
But in that respect have you ever purchased goods from a 3rd Country (as EU now are)? I bought a Playstation direct from Japan. I expected it to arrive with Customs handling charges and tax.(8)
It landed on my mat with nothing to pay. The Customs declaration was interesting - it was a 'Gift' with 'No Commercial Value'. I'd neither expected, nor solicited that. 'Helpful' suppliers will do the same for their UK customers. (9)
So, EU authorities discourage traders registering for UK VAT, and most won't anyway. How does the UK get its VAT? Here's another world of pain.
Fun fact: Neither Royal Mail nor courier companies have the legal authority to open imported packages to verify the contents. (10)
Fun fact: Neither Royal Mail nor courier companies have the legal authority to open imported packages to verify the contents. (10)
Only Border Force have those powers. Remember those extra 5-6,000 Customs Officers not yet recruited and needed to handle post-Brexit freight? Double that.
Won't happen. The chances of you getting your package without any charges are therefore pretty favourable. (11)
Won't happen. The chances of you getting your package without any charges are therefore pretty favourable. (11)
And just how would it be administered? Royal Mail and Courier companies will rightly resist collecting charges on customers' doorsteps - your tax HMRC; your problem. So what happens? (12)
Are all packages put in a cage waiting Customs inspection and a stamp saying they're duty paid and cleared for delivery? Won't happen. Sheer volumes will overwhelm everyone involved. (13)
To sum up, it's a logistical nightmare; it's wide-open to abuse; and it's unenforceable.
And bear in mind this is just a tiny corner and relatively insignificant illustration of Brexit problems the UK Govt has imposed on itself. (14 and END)
And bear in mind this is just a tiny corner and relatively insignificant illustration of Brexit problems the UK Govt has imposed on itself. (14 and END)
