Call to action: New EU VAT law could kill E-Commerce and affects everyone

AUSTRIA Situation

The Chamber of Commerce state this, esp. for small and med.sized companies:

1. we have 2 kind of morvalue tax - 10 % for books, meal->etc. will be altered in next months) and have 20 % for the main othrs: sw develeopment, services, support (like e-books)
2. Business to Businnes : no change in tax handling - Business to private consumers is regulated: paying the taxrate of customers country
3. Smallbusiness with upto 30.000 EUR yearturnover, new: allowed special - MOOS //Special agreement//= if seller has an exiting tax-number than it can request a EU-tax number and has to state quarterly his turnover with which buyer in foreign country, and 've to pay.

My opinion, the new law is done by amateurs: the morevalue tax has been created to have the payment in the prouction chain on each level. The end consumer has the tax sum of all levels. If a german buyer has to pay for austrian good, ::: he pays theoratical this sum, which include the tax f. material and vages of this country. Why have we austrian to send this endsum to e.g. germany?

AlexRag wrote: So as I buyer outside Europe and thus not subjected to the VAT we should be expecting an increase of the core pricing? Is that the correct understanding?

1. Generally speaking: It is likely to happen for a part of other e-services sites which can't account for various VATs at displayed prices and/or in their cart.

2. If you ask about us, for this site:

- We do not plan to, nor want to, charge #EUVAT-related costs to non-EU customers, even though we already incurred time lost because of #EUVAT (and this lost time affected my own development time). However some general adjustments in our offerings may happen in 2015 in relation with, or triggered by, addressing #EUVAT.

- For EU customers, an increase is unfortunately very possible, as well as readjustments in our offerings available to EU customers until the EU Commission fixes the issues of this new regulations that have been shown, so that it can be properly implemented.

Back to general:

If enough people understand that each voice (tweets, FBs, mails) counts, all together, we can improve the world (or in this case avoid it to go worse), things should go fine for everyone.

But if the example set by EU goes through without enough complaints to stop it, other countries might implement similar bad schemes (and as far as the information I read on #EUVAT channels is correct, US government as well as Japan and other governments might "fight back" EU with similar Sales-Tax schemes. Those who would loose in such a case would be users of E-services, as in the end effect, someone is paying for all that burden. And many small entrepreneurs and future entrepreneurs will just stop or not even start, as this increases the cost and burden to start and conduct a startup business. Just search Twitter for #EUVAT to understand how people are affected by this.

Wrongly implemented taxes have been successfully stopped or fixed when enough people protests in the past (e.g. Poll Tax in U.K.), I have some hopes that this could be the next one.

Pepperstreet,
You are sure right, but unfortunately, most of those payment providers will not be ready for 1.1.2015 or have not even communicated plans to address #EUVAT.

Back to more interesting CB work

I'm a bit confused with this VAT thing.

I have a registered company in Brazil using cbsubs.. I have customers worldwide including EU.

Does this affect me?

Do I need to charge my EU customers even though I have a Brazilian company?

henryrok wrote: I'm a bit confused with this VAT thing.

I have a registered company in Brazil using cbsubs.. I have customers worldwide including EU.

Does this affect me?

Do I need to charge my EU customers even though I have a Brazilian company?

If you sell pure E-services (Electronically fully automatically delivered services without manual work involved or bundled) into EU countries, it most probably affects you wherever you (as a seller) are located in the world and (that is the worst part:) whatever your turnover with EU countries is (as there are no reasonable thresholds built-into that new regulation).

If you sell services which include a significant part of manual services, then the new law most probably does not affect you. However the older EU laws are still applicable: E.g. country-specific VAT-registration requirements pertaining tot heir individual thresholds may apply. Same is already the case in other countries.

The above is neither legal nor tax advice, just a general personal understanding, and your accountant or national VAT office should be able to give you a clear reply based on a description of your exact situation.

Thank you for your reply Beat.

Let say we all need to do the TAX thing even we are not an EU company. How are they gonna check those? Don't tell me they are going to roam around the world and knock on our doors to get the freaking tax?

I'm not trying to play smart but I am curious with all of these. it does not make any sense.

I bet big companies right now are laughing...best news to start the year! It surely removes small players.. then less competitions for them.. what a world we are living!

Hi,
What can the EU do to force no-EU based company (US,CH,Asia...) to follow this rule.
The same rule has been active in Non-EU countries already since 2003 but nobody follow it.
Do you have an example of a Joomla actor outside EU that charge EU VAT?

More info for non EU providers
www.happybootstrapper.com/2014/im-us-whatll-happen-just-ignore-eu-vat-changes/