eBay launched pan-European VAT petition
EU leaders are currently discussing changes to the existing EU VAT system that could have a significantly negative impact on small businesses and consumers in Europe, including:
- New taxes on cross-border sales
- Higher prices for consumers
- More red tape for European small businesses
- Less cross-border trade within Europe
- Less choice for consumers
The proposed VAT reforms would force European small businesses who currently do not charge VAT in their home country to do so for sales to other EU countries as soon as they reach the relatively low level of €10,000 across the entirety of the European Union. Which means these proposals would have the largest negative effect on the smallest businesses.
This could force many small businesses to stop exporting entirely. The new rules would make low value imports from outside the EU subject to VAT which, whilst you might think this a good thing could significantly impact UK retailers after Brexit.
At the completion of this petition campaign, the eBay Government Relations team and members of the eBay Small Business Ambassador Network will formally present the petition to European leaders. As always, eBay say that they will continue to fight for legislation that is fair for sellers and consumers.
You can sign the petition here.
There are too many “small” traders on ebay who appear to be avoiding vat by having 2 or more accounts. We pay VAT as a legitimate business its about time the EU did something positive to block any loopholes
We pay it also, and there are far too many loopholes, from what I see this seems to be leveling things up a bit. low value imports from outside the EU subject to VAT am all for that.
“eBay have launched a pan-European petition to give you a voice….”
but only if your voice says what ebay wants it to?
“The new rules would make low value imports from outside the EU subject to VAT which, whilst you might think this a good thing could significantly impact UK retailers after Brexit.”
Brexit is a while of yet, and by the looks of it on a bit of a delay.
Why would I sign something so sellers who avoid VAT and misuse LVTG schemes to undercut me.
All this does is level up the playing field. All eBay is interested in is the fees it makes from sellers from China.
It is actually the EU doing something positive to protect business and keep jobs in the EU. Time we had a Level playing field.
If Ebay are so concerned about the VAT situation then they should tackle the 1,000’s of UK businesses with > £100K turnover that sell on ebay without charging VAT.
One of our competitors had sales last year , just on ebay alone of £430K without charging VAT , we have spoken to eBay about this till we are hoarse , but as long as they keep getting fees they have no problem in aiding law breakers.,
You need to be talking to Customs and Excise and HMRC about these sellers not Ebay.
€10,000 net or gross? I see a lot of bigger VAT sellers on here thinking this is a great move, but for genuine smaller sellers it could be absolutely devastating. It is a very ill-conceived idea by people who do not really have a clear grasp of how many small businesses are already living on the edge.
Gareth there a lot of very big business sellers who avoid VAT, this is effects not just those who play by the rules and the jobs , but effect’s small sellers just as much.
You get a level playing field people might stop buying from the cheapest option all the time, because they have a 20% advantage, never mind they are only interested in profiting themselves, this is good for smaller traders. These type of sellers who avoid VAT and tax of all sorts are one of the reasons many smaller sellers are living on the edge.
The EU may be barmy sometimes but this is a good idea. Plus it is the sort of protection home grown business may be sadly lacking very soon.
Sam, I understand where you’re coming from, sellers are frustrated and they want everyone to play by the same rules. Small businesses would be caught up in the same trailing net though. Many of us work silly hours for little pay, with families to support and children to give time to. We don’t have the time for the additional accountancy, can’t absorb the additional costs, and can’t afford to pay an accountant. As a small trader there is no upside for me, I would simply stop selling to other EU countries when I neared the limit, and concentrate on domestic sales and those outside the EU. I doubt I’m the only one.
Probably eBay biggest client a UK registered company, gained an unfair advantage for years by sending everything from the Channel Islands hence avoiding VAT, it put a lot more people out of work than it ever employed, this included many small eBay sellers.
Every day we complete with another one who sends anything under £18.99 from Switzerland via a subsidiary hence avoiding VAT and paying back into the very society they profit from. This is before we even talk about the abuse from Chinese sellers. These are the very types of companies that keep peoples wages low one of the major issues in the UK right now.
Smaller traders might get a chance to grow their business and hence not so many would be on the breadline, and I have kids and a house to keep also, and we are no big massive firm. Plus I Totally understand it is not easy at all out there.
If I could cut my prices by 20% just like that my sales would go through the roof. Sometimes you need to take a bit of short term pain for the better good. This petition is all about eBay profits these people are all self serving. The practice they want cost society a lot more than it ever gains from saving 50p on a toothbrush from China, we all pay for this in the long term.
I fully agree with forcing Ebay sellers to charge (and pay) VAT. Charging VAT on Ebay fees is a start and long may it continue.
There are thousands of sellers working from home but with proper established Ebay shops and turning over thousands £’s each month. No VAT, no income tax, no business rates, no comeback. I don’t care if they have families and children they are defrauding the tax man and therefore the honest tax-paying public.
There are Chinese sellers with UK registered Ebay shops selling in the millions £’s and dragging those millions out of the UK without touching a proper bank. Completely unaccountable.
We come across these sellers when we check competitor’s pricing or our manufacturer’s ask us to locate a certain seller who is selling their items but not an authorised reseller.
These people are the new market trader black economy and should be reported to HMRC every time they are discovered.
Every time I discover an Ebay seller running an established Ebay shop from a private address (not commercial premises) as a business I pop off a quick email to HMRC compliance giving the Ebay name and address (found at the bottom of each listing) and a link to their shop.
Let’s make business fair… I pay VAT, income tax, wages, business rates and so can they!
Thanks Chris for this great explanation. What about digital gift cards? Both if redeemed for digital goods or not.
Assuming the UK leaves the EU Customs Union and no special arrangement is made, according to the current version of the EU VAT proposal pending approval:
– From 2021, Amazon/Ebay will collect EU VAT on sales by UK merchants to EU consumers and pay it to the concerned EU country. Indeed, the marketplace will be deemed the merchant for VAT purposes only;
– If the merchant is using Amazon FBA in Europe, the merchant will need a VAT number in each EU country where the goods are stored (same as now);
– Amazon FBA or any other fulfilment service provider may be held liable for any unpaid VAT by the UK merchant using their EU facilities, unless Amazon proves they are in good faith and have adopted measures to avoid any VAT evasion;
– Goods with a value exceeding Eur 150 shipped from the UK to the EU will pay customs duty at the border.
The reform does not help trade between the UK and the EU, it is true.
In general, it is a reform that helps cross border E-commerce within the EU and tries to reduce VAT evasion on parcels imported from outside the EU (China, etc).
It is a reform that CANNOT make marketplaces happy.