The EU has no jurisdiction. It has rules. If you want to sell
in the EU you will have to comply. If not, then there's no problem.
Truly speaking, i don't really know how the whole thing will work,
we can only wait and see.
Maybe they will close the frontiers (both real and electronic ones)
to unlawful companies...
Trade regulations may be very hard to understand. Since some big US companies
are already taking the necessary steps to comply, i'm quite sure there's
some kind of agreement between the governments.
You're right, noone can enforce. But we have trade agreements we all have to comply with.
I think the hassle for USA companies will be small. Probably only tracking the EU sales, which they already do, and give the money to their own government.
You're not forced to sell in EU if you don't want to.
There are many nation in the world with strange regulations and you have to follow them if you want to sell in that country.
Take a shipping guide from TNT, UPS or FedEx and you'll see what i mean.
Let me explain how this VAT thing works as i've read a few incorrect statements.
When you are an EU customer and are importing goods, or buying a service, from a company in another
EU state you will have to pay the VAT to either your own state, if you have a VAT number (i.e. you a re a company or a professional), or
to the state from which you're buying from.
Let me give a few examples:
Company A in IT buys from Company B in DE:
A pays the net price to B and IT VAT to the Italian state.
A, because is a company, will subtract the VAT payed from the amount it owes to the state.
Individual A in IT buys from Company B in DE:
A pays the net price + DE VAT to B.
B will in turn forward the DE VAT to their own state.
Now that's the situation in the EU. If you're buying from the USA the things are a little bit different:
Company A in IT buys from Company B in the USA:
A pays the net price to B and the IT VAT + customs to the Italian state.
Individual A in IT buys from Company B in the USA:
A pays the net price to B and should pay IT VAT
+ import tax to the Italian state.
What really happens is that, often, A will not pay the VAT nor the import tax because the package
is not checked at the customs.
This is, however, illegal.
What is going to change:
- For EU companies: Little or nothing.
- For USA companies: They will have to collect VAT tax from the UE citizens and forward it to the
EU.
- For EU individuals: They will have to pay
the taxes because the law will be enforced
at the point of origin.
- The market: EU companies will gain
the advantage they had lost due to unfair
practices of the UE citizens (or customs offices).
This may seem strange, but is just a way to enforce the law which will, however, put some hassle to USA companies.
Slashdot Mirror
The EU has no jurisdiction.
Truly speaking, i don't really know how the whole thing will work, we can only wait and see.It has rules.
If you want to sell in the EU you will have to comply. If not, then there's no problem.
Maybe they will close the frontiers (both real and electronic ones) to unlawful companies...
Trade regulations may be very hard to understand. Since some big US companies are already taking the necessary steps to comply, i'm quite sure there's some kind of agreement between the governments.
I've never said it will work ;) I think this law has or will be discussed
with the US autorities.
An EU customer won't be able to break the law because the VAT is collected by the US company.
You're right, noone can enforce. But we have trade agreements we all have to comply with.
I think the hassle for USA companies will be small. Probably only tracking the EU sales, which they already do, and give the money to their own government.
You're not forced to sell in EU if you don't want to.
There are many nation in the world with strange regulations and you have to follow them if you want to sell in that country.
Take a shipping guide from TNT, UPS or FedEx and you'll see what i mean.
No, not the UE, the USA.
I perfectly understand this. Do you think that small businessman that thinks the way you are describing is not evading US taxes?
Is not breaking any other US law?
When it will get caught someone will ask him his EU VAT filings and will add another charge on top of the many others.
Obviously is plenty of "bad guys" out there, but the whole world works because they're just a minority.
The big ones will surely comply, they've no reason not to do so, and they're probably the ones the UE is interested in.
The others will get caught sooner or later and will face the consequences of their actions.
The overrall result is that the EU market will get a speedup.
Let me explain how this VAT thing works as i've read a few incorrect statements.
When you are an EU customer and are importing goods, or buying a service, from a company in another EU state you will have to pay the VAT to either your own state, if you have a VAT number (i.e. you a re a company or a professional), or to the state from which you're buying from.
Let me give a few examples:
Company A in IT buys from Company B in DE:
A pays the net price to B and IT VAT to the Italian state.
A, because is a company, will subtract the VAT payed from the amount it owes to the state.
Individual A in IT buys from Company B in DE:
A pays the net price + DE VAT to B.
B will in turn forward the DE VAT to their own state.
Now that's the situation in the EU. If you're buying from the USA the things are a little bit different:
Company A in IT buys from Company B in the USA:
A pays the net price to B and the IT VAT + customs to the Italian state.
Individual A in IT buys from Company B in the USA:
A pays the net price to B and should pay IT VAT + import tax to the Italian state.
What really happens is that, often, A will not pay the VAT nor the import tax because the package is not checked at the customs.
This is, however, illegal.
What is going to change:
This may seem strange, but is just a way to enforce the law which will, however, put some hassle to USA companies.