EU Changes VAT Rules for Imported Products; Everything to be Taxed Independent of Value

[TumbleGeorge]

This law is created to defend european companies which overprice their goods several times...

Most europeans has not enough incomes to live buying only goods made in EU.

 

[Kohl Baas]

From what I know, that trick wasn't really working for some years now. Or at least it wasn't certain that someone would avoid taxation. The thing is that many people, me included, buy some stuff from China, stuff that can't be easily found in EU or they can be found at much higher prices. With everything getting a tax, EU is trying to get some extra income from all those imported stuff and also make buying directly from China less appealing. I guess it is also something that EU retailers where hopping to see, because they where losing customers.

It's not that hard. If customs think your merch has a higher price, they will demand an invoice of the payment.

With smart chinese seller, you can manage to have a 20€ payment for the 200€ product, having the same 20€ on the box, and after that, you will buy a sweet little "nothing" from the seller for 180€ which he'll never ship.

This was the real trick. And customs can't do much with a 200€ product in hand with a 100% legitimate invoice of 20€... Even if they know it costs 200€.

 

[ThomasEichorst]

EU the ultimate big taxing nanny state. Totally corrupt, totally incompetent, so wonder the UK wanted out, not that Johnson and the Tories aren't utter morons and corrupt, better to deal with just one scumbag government than the EU autocrats.

Read the Wirko's post - you poor sods got shoved all the same if not worse, ha, the irony

 

[Readlight]

It's not that hard. If customs think your merch has a higher price, they will demand an invoice of the payment.

With smart chinese seller, you can manage to have a 20€ payment for the 200€ product, having the same 20€ on the box, and after that, you will buy a sweet little "nothing" from the seller for 180€ which he'll never ship.

This was the real trick. And customs can't do much with a 200€ product in hand with a 100% legitimate invoice of 20€... Even if they know it costs 200€.

That's how I bought my mobile phone cheaper.

 

[john_]

It's not that hard. If customs think your merch has a higher price, they will demand an invoice of the payment.

With smart chinese seller, you can manage to have a 20€ payment for the 200€ product, having the same 20€ on the box, and after that, you will buy a sweet little "nothing" from the seller for 180€ which he'll never ship.

This was the real trick. And customs can't do much with a 200€ product in hand with a 100% legitimate invoice of 20€... Even if they know it costs 200€.

Yes, that was the trick years ago. If customs where opening the package and they where finding a 200 euros product, it was treated as a 200 euros product. No matter if the Chinese had put a 20 euros price, no matter if you had proof that you only payed 20 euros, no matter if it was declared as a gift, no matter even if it was something you already owned and you have shipped it to yourself from your house in China, Australia, Canada, whatever to your other house inside the EU. If you where lucky and customs wasn't opening your package, you could pass a 747 Jumbo without paying extra tax.

This is terrible because VAT is not the only tax that will be collected, customs will also want their take to release the hostage parcel and the shipping companies will also take their cut for the extra hassle and processing. So something silly that before costed 2$ and that you would even be hard pressed to buy in a EU shop will cost 7$ on fees to different intermediaries, f****** bullshit!

Up to 150 euros, you only pay VAT, nothing to customs or anyone else. So, that $2 goes up to $2.5, not $7.

 

[Easo]

This is purely to bring manufacturing back and not fully rely on China doing it for cheap. Not going to pretend that the average Joe will dislike it, but average Joe does not think longterm, which is where this should help.

 

[LTUGamer]

It's not that hard. If customs think your merch has a higher price, they will demand an invoice of the payment.

With smart chinese seller, you can manage to have a 20€ payment for the 200€ product, having the same 20€ on the box, and after that, you will buy a sweet little "nothing" from the seller for 180€ which he'll never ship.

This was the real trick. And customs can't do much with a 200€ product in hand with a 100% legitimate invoice of 20€... Even if they know it costs 200€.

Haha. That is not how it works, at least in Lithuania. I get free SSD samples from AData. I didn't bought them, I get them free. Customs stoped it and asked to pay 21% of VAT. Despite fact that shipment was marked as DDP (all taxes, including customs, are paid by sender), I began to fight again customs, send documents etc. And they said: "it just peace of paper, you can draw anything you want. You must to pay VAT, despite fact that it is evaluation sample which was send for free"

In modern country "peace of paper" can send you into jail. And they said "you can draw anything you want"...

 

[megaflegmi]

Yes, that was the trick years ago. If customs where opening the package and they where finding a 200 euros product, it was treated as a 200 euros product. No matter if the Chinese had put a 20 euros price, no matter if you had proof that you only payed 20 euros, no matter if it was declared as a gift, no matter even if it was something you already owned and you have shipped it to yourself from your house in China, Australia, Canada, whatever to your other house inside the EU. If you where lucky and customs wasn't opening your package, you could pass a 747 Jumbo without paying extra tax.


Up to 150 euros, you only pay VAT, nothing to customs or anyone else. So, that $2 goes up to $2.5, not $7.

Nope, not true on the 150 euros and the VAT only. Here in Bulgaria when you get your package stopped for taxation you need to have errr some declaration with a bank statement. That document can be made by DHL(if your seller shipped with them), our post service or some small companies with an office with 2 computers that take 10-20 euro to make that document, the post takes 10euro, don't remember how much DHL wanted. If you want to make the paperwork yourself you're told you need a digital signature registered with the customs office(you can do that for 50-100 euro per year) and after that you need to know how to fill in that document that they don't even have a template for (everything is the document is in code, not just plain text - E43, T22 etc) ... everybody uses some kind of software made especially for that ... costing more money, so effectively you always pay minimum 10 euro to get the documents to release your parcel, and after about a week of waiting they serve you the bill that is usually what you say ... 20% more plus may be some other tax usually 3-5% for electronics which I get from aliexpress. So to get a 2euro parcel will cost me 10(mandatory documentation)+0.4(20%)+3%(very rare) = 12,4 euro ... May be where you live they just make you pay your tax which is fine with me ... but here they milk everything ... oh and one more great thing ... If the seller shipped with free shipping with DHL, TNT or any other higher value shipping service and you're stopped at customs, they just tell you there is no such thing(I even had an official DHL document stating that the seller paid for shipping), pick up the phone in front of you and ask DHL how much to ship 3kg of goods from HK to BG and they add that right in sneering at you, which is quite the sum for some random caller that doesn't have a contract with them, and they offer quite better prices if you ship regularly with them(which the aliexpress guys do). So it doesn't matter if shipping is taken care of by the other side you still pay 20% for it. So if my little RS232-to-TTL for 0,50Euro gets flagged for taxation I get a lovely price upgrade ... if something is shipped with faster shipping - bigger price upgrade ... hope in other EU countries is different.

 

[Sithaer]

The 3eur/hr was an example rather than an actual amount. Considering we can afford to buy these things, we definitely make more than the average worker there, otherwise the factories would operate at a loss.

Yeah I know, I just wanted to point out that being from EU also doesn't mean 15 eur/hour if you aint from the wealthier countries.
My country doesn't even have Euro as a currency yet so first we have to convert to that.

Nope, not true on the 150 euros and the VAT only. Here in Bulgaria when you get your package stopped for taxation you need to have errr some declaration with a bank statement. That document can be made by DHL(if your seller shipped with them), our post service or some small companies with an office with 2 computers that take 10-20 euro to make that document, the post takes 10euro, don't remember how much DHL wanted. If you want to make the paperwork yourself you're told you need a digital signature registered with the customs office(you can do that for 50-100 euro per year) and after that you need to know how to fill in that document that they don't even have a template for (everything is the document is in code, not just plain text - E43, T22 etc) ... everybody uses some kind of software made especially for that ... costing more money, so effectively you always pay minimum 10 euro to get the documents to release your parcel, and after about a week of waiting they serve you the bill that is usually what you say ... 20% more plus may be some other tax usually 3-5% for electronics which I get from aliexpress. So to get a 2euro parcel will cost me 10(mandatory documentation)+0.4(20%)+3%(very rare) = 12,4 euro ... May be where you live they just make you pay your tax which is fine with me ... but here they milk everything ... oh and one more great thing ... If the seller shipped with free shipping with DHL, TNT or any other higher value shipping service and you're stopped at customs, they just tell you there is no such thing(I even had an official DHL document stating that the seller paid for shipping), pick up the phone in front of you and ask DHL how much to ship 3kg of goods from HK to BG and they add that right in sneering at you, which is quite the sum for some random caller that doesn't have a contract with them, and they offer quite better prices if you ship regularly with them(which the aliexpress guys do). So it doesn't matter if shipping is taken care of by the other side you still pay 20% for it. So if my little RS232-to-TTL for 0,50Euro gets flagged for taxation I get a lovely price upgrade ... if something is shipped with faster shipping - bigger price upgrade ... hope in other EU countries is different.

Funny thing is that July 1 is getting close and we still don't know how exactly will this work in my country.
From what I read they also gonna stop every package not just randomly selected ones.

I'm not following up politics or any of that crap so I'm gonna ask my bro later since hes been ordering stuff from Ali/Asia for like 10 years already and knows this stuff better than me.
Tho he mentioned a few days ago that its gonna be someting like every 1 euro you can add +1 after this change and that will be the end price.
Basically doubling the prices compared to now but this I will have to check with him again and also wait for more official statements.

 

[Pumper]

"Of course, this creates a lopsided, uphill battle for EU-based manufacturers and distributors, who have to collect the appropriate tax upon all sales" - the vast majority of the stuff is not even manufactured anywhere in the EU. The only reason people buy from China is because the local retailers are selling the same cheap crap with 1000% profit margins. Even with the new taxes if will still be cheaper to import from China rather than buying from local scalpers (something for 2€ from China will now cost 5-7€ with taxes and other charges, but the local store is selling the same thing for 15€).

 

[Raven Rampkin]

Let's just see where prices for Ali-type jank sold within EU head in July I bet my backside the inflation can be pretty massive.
As for customs clearance (a topic that's been brought up in this convo before), our postal service promised to only ask 3eur for lower value stuff from now on, and the general rates still hold (9 standard, a bit more for higher value items + extra per each declaration page).
Now what's to come from other carriers like Omniva... I've no clue. Ppl like DHL are already hopeless. The more you pay for the service, the more abysmal the quality of the service - and the more abysmal and daylight robbing the customs intermediates. I won't be surprised if some 1eur wires people receive via a carrier and not postals, end up at 20 or 30 starting July.
But I dunno, maybe it was destined to end up like this. I picked up my $3 package today (legit $3 after coupon), shipped from a Chen in Estonia lol... yea sure. Packages like this also come with "not conforming to EU bla bla" stickers all the time. Which don't mean anything in the end. So on balance, the schemes to relax taxation and clearance pulled by our fellas in China (and a few other places) are some WILD shtick. Guess they would come to an end sooner or later.

 

[Shou Miko]

To be honest I do not mind paying taxes on the things I order it's the national post service here £18,5 the nation post service wants for handling the package the issue is they they it ex. vat and they shouldn't be able to do this since they are dealing with a private person everything should be incl. vat here.

So you actually end up paying £23,12 and not £18,5 but the system doesn't care and no buddy that cares really got the money want to file a case against this it's so lame....

Again I don't mind they put 25% tax on it sure you buy stuff you cannot get in my country fair but it's the fee from the national post service that makes me angry.

 

[Deleted member 197223]

Brexit + this = no point buying anything from the UK now. I bet they're really happy over there. I wonder how this will effect amazon.co.jp or stuff bought on ebay from JP/KR. Perhaps it'll be cheaper to fly over instead having it shipped directly. I mean this is how you could circumvent the storage "tax" just for being in the EU. Drive to Germany or any nearby country and buy what you need then drive back home.

 

[trsttte]

Yes, that was the trick years ago. If customs where opening the package and they where finding a 200 euros product, it was treated as a 200 euros product. No matter if the Chinese had put a 20 euros price, no matter if you had proof that you only payed 20 euros, no matter if it was declared as a gift, no matter even if it was something you already owned and you have shipped it to yourself from your house in China, Australia, Canada, whatever to your other house inside the EU. If you where lucky and customs wasn't opening your package, you could pass a 747 Jumbo without paying extra tax.


Up to 150 euros, you only pay VAT, nothing to customs or anyone else. So, that $2 goes up to $2.5, not $7.

not true, there's always handling fees and some are fixed price, not percentage (i'm speaking on recent experience). They supposedly will lower those expenses and "optimize the process so it becomes faster and cheaper" but of course they will, sure thing...

 

[john_]

Just to reply to everyone.
I do the assumption here that in all EU members things will be the same after 1st July.
What I am posting is what I read in a very nice article that can be found in the link below. The author does say that he could be wrong, as there isn't something official and concrete yet. And also you'll have to google translate it, if you chose to have a look at it

[Ολες οι νέες αλλαγές απο 1η Ιουλίου] Αγορές εκτός Ε.Ε και τελωνείο: Πως θα κάνω αγορές απο Κίνα και Αγγλία; Πόσα θα πληρώσω στο τελωνείο; - Angroid.gr

Απο 1η Ιουλίου 2021 άλλαξαν αρκετά στις αγορές σας απο εξωτερικό, για αυτό ρίξτε μια ματιά για να ξέρετε τι ακριβώς σας περιμένει. - Angroid.gr

www.angroid.gr

Until now (in Greece)
0 - 22 euros >>>>free
22 - 150 >>>> VAT plus custom expenses
150 and up >>>>> VAT plus custom expenses plus duties

From July 1st
0 - 150 euros >>>> ONLY VAT
150 and up >>>> VAT plus custom expenses

In any case we will find out what will happen in the next months. Chinese sellers will probably also find some ways to import stuff in EU avoiding taxes or with less taxes, but probably we will be buying less stuff from China. That will not necessarily increase sales in EU, because we do buy stuff that we can live without them. That's why we can wait 1-2-3 months without bothering to get that stuff we ordered. It's just that when you see such low prices, you have to buy it!!! But at normal prices, we will probably ignore much on the stuff we will be browsing after 1st of July.

 

[GLeader]

they can suck my it, no european warranty no european taxation

exactly

 

[GrayAx]

One thing to add:

Here in Norway (not part of EU, only has some economic treaties with them.) this was done a couple years ago. (Early 2019 I think it was?)
Yeah, it sucks a bit that things under ~22 eur are now always taxed, but this actually made it a lot cheaper to order things that just come over that limit.

Before the change: Everything over the limit went through customs, and customs/Post happily took a ~15eur charge to look at the packet, type in the value, and that was that.
But after the change happened, most online sites (ebay, aliexpress, etc) started processing customs electronically while purchasing.

This meant that all purchases over the limit suddenly became notably cheaper, since they no longer had to go through the +15 eur processing at customs.
It used to be something like
Product: 30 eur inc shipping. + 25% VAT (+7.5) + Customs processing ( +15) = 52.5.
While now it's: Product 30 eur inc shipping + 25% VAT (+7.5) = 37.5.

And for all the cheap <20 eur tat you might be buying from china and the like, the only different is that the VAT gets slapped on. Provided you buy from a store that processes VAT electronically on purchase.
It makes purchases under the limit sliiightly more expensive due to VAT, but it makes the medium sized 20-50+ etc purchases cheaper on the whole for end users, since you don't need the costly processing at customs anymore.
(Again, provided the site you buy for registers the VAT when you buy it, which they'll show during checkout.)

I buy some stuff from aliexpress now and then, and I quite like being able to see exactly how much a product is going to cost when buying it, since they'll calculate price+shipping+vat right in the checkout.
No more getting surprised by a sudden customs processing fee.

I find it's usually the extra processing fee that people get put off by, and that vanishes when it's all registered electronically on purchase.

 

[Wirko]

Pretty please everyone, can we stop confusing customs duty and value-added tax? Even the original post by @Raevenlord isn't helping to understand it.

Customs duties (import taxes, tariffs) are imposed on imported goods. The rates are between 0 and 4% in most cases, depending on the category and origin of goods. Can go higher when used as a weapon in trade war. Can go higher if the incumbent elected Monarch of the US has a bad day. Items up to a certain value are not taxed; the threshold is 150 €/shipment in EU, £ 135/shipment in UK, $800/day in US. Nothing changes here on 1st July, 2021.

Value-added tax (VAT in EU and UK) or sales tax (in US) is imposed on everything that's sold, no matter if it's domestic or imported. Ebay collects sales tax on imports to US - I can't find any info on whether there's a threshold or not. Collection has been getting stricter in the recent years.

Now for the EU and UK. Both are closing a stupid taxation loophole that allowed only imported goods of up to 22 € (£ 15 in UK) to be exempt of VAT. China is not objecting. Yes, people like me who bought countless $3 items on ebay benefitted from that a lot. China benefitted even more. But all those who still have the weird determination to manufacture and distribute anything in the EU ... well, ... we are a services-based economy, right?

The baddest part for consumers is the fixed cost of customs processing per shipment, in addition to the fact that we didn't know any details until a month ago. The Brussels bureaucrats (the lower ranks, those that only eat caviar if any of it remains, and sometimes do useful things) have created a simplified procedure for customs declaration called Import One-stop Shop (IOSS). The cost is coming down from mostly unacceptable to sometimes acceptable. I can speak for Slovenia: it will be 2,50 € per shipment, compared to 5 € minimum now. Sorry, I'm unwilling to use decimal point now that UK is out.

I'll be happy to update this post if I receive better information from any country. I also need to know if the $1.19 package from Ebay that I ordered 64 days ago will arrive before July.

One thing to add:

Here in Norway (not part of EU, only has some economic treaties with them.) this was done a couple years ago. (Early 2019 I think it was?)
Yeah, it sucks a bit that things under ~22 eur are now always taxed, but this actually made it a lot cheaper to order things that just come over that limit.

Before the change: Everything over the limit went through customs, and customs/Post happily took a ~15eur charge to look at the packet, type in the value, and that was that.
But after the change happened, most online sites (ebay, aliexpress, etc) started processing customs electronically while purchasing.

This meant that all purchases over the limit suddenly became notably cheaper, since they no longer had to go through the +15 eur processing at customs.
It used to be something like
Product: 30 eur inc shipping. + 25% VAT (+7.5) + Customs processing ( +15) = 52.5.
While now it's: Product 30 eur inc shipping + 25% VAT (+7.5) = 37.5.

And for all the cheap <20 eur tat you might be buying from china and the like, the only different is that the VAT gets slapped on. Provided you buy from a store that processes VAT electronically on purchase.
It makes purchases under the limit sliiightly more expensive due to VAT, but it makes the medium sized 20-50+ etc purchases cheaper on the whole for end users, since you don't need the costly processing at customs anymore.
(Again, provided the site you buy for registers the VAT when you buy it, which they'll show during checkout.)

I buy some stuff from aliexpress now and then, and I quite like being able to see exactly how much a product is going to cost when buying it, since they'll calculate price+shipping+vat right in the checkout.
No more getting surprised by a sudden customs processing fee.

I find it's usually the extra processing fee that people get put off by, and that vanishes when it's all registered electronically on purchase.

Good to know! I see that in Norway, the future is now.
Many sellers on AliExpress ship from multiple warehouses and you have a choice to have stuff delivered from China or EU. Can I expect to pay for customs processing if I order from China, and not pay if I order from EU?

 

[john_]

One thing to add:

Here in Norway (not part of EU, only has some economic treaties with them.) this was done a couple years ago. (Early 2019 I think it was?)
Yeah, it sucks a bit that things under ~22 eur are now always taxed, but this actually made it a lot cheaper to order things that just come over that limit.

Before the change: Everything over the limit went through customs, and customs/Post happily took a ~15eur charge to look at the packet, type in the value, and that was that.
But after the change happened, most online sites (ebay, aliexpress, etc) started processing customs electronically while purchasing.

This meant that all purchases over the limit suddenly became notably cheaper, since they no longer had to go through the +15 eur processing at customs.
It used to be something like
Product: 30 eur inc shipping. + 25% VAT (+7.5) + Customs processing ( +15) = 52.5.
While now it's: Product 30 eur inc shipping + 25% VAT (+7.5) = 37.5.

And for all the cheap <20 eur tat you might be buying from china and the like, the only different is that the VAT gets slapped on. Provided you buy from a store that processes VAT electronically on purchase.
It makes purchases under the limit sliiightly more expensive due to VAT, but it makes the medium sized 20-50+ etc purchases cheaper on the whole for end users, since you don't need the costly processing at customs anymore.
(Again, provided the site you buy for registers the VAT when you buy it, which they'll show during checkout.)

I buy some stuff from aliexpress now and then, and I quite like being able to see exactly how much a product is going to cost when buying it, since they'll calculate price+shipping+vat right in the checkout.
No more getting surprised by a sudden customs processing fee.

I find it's usually the extra processing fee that people get put off by, and that vanishes when it's all registered electronically on purchase.

That's what is happening in Greece also, and that's what I am describing a few posts above.
Probably that's what will be the case in other EU countries from July.

 

[Wirko]

they can suck my ****, no european warranty no european taxation

The importer (noel_fs) should offer warranty to the buyer (you). If needed, send the warranty claim to the importer, I'm sure they will do their best to help you.

 

[Threadshredder]

And Amazon is ready to open bottles of Champagne!

Except it makes little sense for them to celebrate this, especially not in the short term. I would bet something like 80% of the products on Amazon are directly imported from China. This will raise all the prices of these cheap goods, so people will buy less of them. This isn't good for Amazon but it's a very good step in my book.

Most europeans has not enough incomes to live buying only goods made in EU.

Also, most people in the EU have so much Chinese crap in their closets that they don't know where to even start to get rid of it. Many "poor" people have extra rooms in their apartments just used for storing and hiding it from their guests...

 

[mechtech]

Other than Chinese steel is porous and horrible to weld on, the previous administration was focused on bringing back jobs including the US steel industry. The downside is the cost of construction jobs go up.

Only use North American steel typically for the large construction projects. Where/who anyone buys their stuff from is a decision. I always try to buy North America despite the increased costs vs 'overseas' imports. Wood has gone up here 400% with covid, I think it's companies gouging more than anything...........

 

[GreiverBlade]

awww, will they have Switzerland style taxing? (well our VAT is not "pocketchange VAT" )

damn ... well since Switzerland is not EU we had that since a bit now ... although the max value for tax free was ~64eur which i rarely reach without the need for the seller to put [insert alternate value here]chf declared value (which sometime is not even cheating given the production cost in the country of origin and the sale cost in my own country ... )

Except that the importer/customer going to foot that bill
They will still want that revenue..................
Glad Britex hopefully exempts the UK

ps i only buy from UK Source's/ Stock since we exited the EU
to much hassle to deal with EU since then

mmhhh i doubt it ... you will be on the Swiss level i guess... but well EU will follow US down

 

[Jism]

This law is created to defend european companies which overprice their goods several times...

Well,

I'd suggest you buying your stuff from China and stuff from EU. Tell me which ones blows up faster and second where do you go to claim warranty?

Not alot products from china really have a good reputation. There is a chinese store nearby where i am, and i bought several things. The most simplest thing i bought was a metal clamp that you twist on top of a 75ohms cable used for internet. Guess what? When i put force the metal casting just broke. Not one, nope, three in total. I bought a simple 2 euro brush as well thats intended for in the shower. After using it just once to scrub my back, it broke. Like, how?

I even bought headers for my car engine back in the days. The thing ripped after 6 months of use. Normal casting lasts 2 to 3 year really.

 

[TomTomTom]

VAT is bad because it is not a progressive tax - the rich pay the same VAT% as the poor. i would've expected the EU to have progressive economics as opposed to regressive, "trickle-down" economics, which don't work and create monopolies. i guess socialism is alive and well in the EU (i don't live in EU and not in US)