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U.S. E-Commerce Sites To Collect EU VAT

Posted by ryuzaki0 on from the value-added-tax-is-an-oxymoron dept.

A concerned US-based e-commerce company with inter writes "While we have all been fighting the Internet sales tax battle here in the U.S., the European Union of 15 countries has recently required that all U.S. companies with web sales to EU citizens start collecting the value-added tax on July 1, 2003. The Washington Post has a good article about this. It seems Ebay, AOL, and others caved in on this without much complaint. Can U.S. Internet taxation be far behind if we have to start collecting and reporting 15 different VAT taxes? And sorry Mr. or Ms. EU Citizen, your website subscription now costs 15% to 25% more, starting July 1. Hope you like this added value."

6 of 919 comments (clear)

  1. What will happen? by jolyonr · · Score: 3, Interesting

    if companies in the US, especially small etailers, don't bother?

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  2. Darn by YeeHaW_Jelte · · Score: 4, Interesting

    I've been buying a lot online in the States lately because of the bonus I now get with the Euro being valued so high against the dollar. This will neatly compensate for the savings I make on the exchange rate.

    However, there's nothing really new actually, because officially you were supposed to pay the VAT taxes when the product went through custom. The thing was, some packages would be intercepted in customs, and you'd get a bill for the VAT, and others wouldn't. Profit!

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  3. Why collect here by uspsguy · · Score: 3, Interesting

    I've got to wonder why a US company would collect EU taxes. Wouldn't the destination country just do it when the merchandise is picked up?

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  4. Re:Nop... by Branc0 · · Score: 3, Interesting
    That's exactly what the EU wants with this law. To support the local industry and diminuish the imports of goods from other contries, especially U.S.A.

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  5. Re:VAT by GothChip · · Score: 4, Interesting

    Because we also pay Income tax.

    I don't mind the idea of paying tax. It's just the idea of paying tax when you earn it, paying tax when you spend it and paying tax when you even save it.

    Why can't we just get taxed once.

    But the most evil tax has to be inheritance tax. Even when you die you end up paying tax.

  6. Re:That is the whole point by aaarrrgggh · · Score: 3, Interesting

    All that having been said, I would prefer the elimination of income tax and capital gains tax in favor of a federal sales tax (even if said tax were 30%)...

    The whole problem with tax code is that there are special considerations to help stimulate the economy.

    If you tax sales rather than income, that has an unfair effect on people scraping to get by, while assisting people that save their money, not contributing back to the economy.

    Flat income taxes are the only way to go. In Hong Kong, you pay (IIRC) 15% flat tax on income. It really sucks your first year (when you effectively have to pay tax for two years with one check), but it's a great system. People are still afriad of Inland Revenue to some extent, but the tax dollars aren't wasted on a huge auditing system. Filling out your paperwork takes a couple minutes, then a half-hour in line if you need to file in person.