Have you read and understood what I wrote, and what was said in this forum? I quote:
So, 1. German orders are shipped from Germany (see faq), and 2. since they ship from EU, VAT had to be collected at time of sales (see nicole.faerber).
Since it already had to be collected, it is clear, that it won’t be collected again at time of shipment.
I am with you that this is highly misleading to have these information together, but i also think not having the VAT show on your shop/crowd founding checkout should have made you suspicious. As it is as far as i know required in germany when VAT is collected by the seller.
But yeah not all the best shopping experience for international buyers.
At the time of pledging, I remember hoping that the price included VAT, but acknowledging to myself that it was unclear whether it did or not. I accepted that I might need to pay 20% VAT and maybe some other, unknown, charges and I hoped that the tax and charges did not increase significantly before the phone was shipped. If it became unaffordable, I would have to reject the shipment, and I’d deal with that when the time came. Since I’m a UK resident, the potential impact of Brexit on all of this has been a worry, too. (Conveniently, just as the Librem 5 has been delayed, Brexit has been postponed too.)
One benefit I have been hoping to obtain by having the phone shipped from within the EU to the UK (pre-Brexit, at least) is that it greatly reduces the hassle of receiving the shipment and paying the taxes and charges. If Purism receives the initial import into the EU, then Purism handles the taxes and charges and passes the cost on to me. Simple. Low hassle.
Meanwhile, if Purism ships to the UK from outside of the EU (again, pre-Brexit; who knows what happens after Brexit), then the shipment has to go through a long-winded handling process under the control of the Royal Mail. I wait for a card to arrive telling me what I already know, then, assuming I don’t have to appeal against an error, I pay the taxes and charges, along with a hefty handling charge for the Royal Mail. Then I wait again for the actual shipment to arrive. The Amazons and eBays of the world can bypass this by setting up their own import arrangements instead of relying on the Royal Mail, and they benefit from a more streamlined customer experience because of it. (And, IIRC, a slightly lower cost, because their handling charges are lower than the Royal Mail’s.)
I still get the phone either way, but, for the time being, I’d prefer it to come from the EU. (Once again, who knows what’s the best way to do it after Brexit.)
I agree, no one love vat, but if is needed os fine, but i hope purism could ship from europe as they wrote in their faq campaign, just to avoid all burocracy and time delay customs will add.
we need a manufacturer like Purism in Europe. oh how sweet was it when all countries had some-form of industry. in my country there is only one car factory and even that is at 500km from where i live.
Shipping, handling and fulfillment from Europe will make RMA and warranty handling a lot easier, we totally agree and that’s why we are working on it. But concerning VAT again, it will not save anything. The sales prices in the Purism shop and during the campaign are without VAT - in fact without any taxes. Local taxes will always apply and we can not take into account all local taxes world wide.
Just to give another example… we are considering Germany as this fulfillment hub. This would then mean that if customers from the EU order at Purism and by choosing a shipping destination within the EU the shop will, in the future when this is established, automatically add the 19% VAT that needs to be applied in Germany. The German fulfillment place will be taxable in Germany and will have a German VAT ID, which means, Purism will then pay the 19% VAT that were collected at time of sales to the tax authorities in Germany. Businesses within the EU can order VAT free if they supply a valid VAT ID, consumers re not eligible for this, sorry.
So you see, regardless of where the VAT gets slapped onto the sales price, at some point the consumer has to pay it, one way or the other, there is no way around it. We as Purism can not just silently eat any and all taxes that may get applied somewhere - we already do this with the shipping cost and I can tell you that shipping is pretty expensive in the US.
i think that some people who have been vocal in regards to this VAT “issue” have MAYBE been silently suggesting that Purism is to take the MAXIMUM VAT value, slap it to the “shop-price” then based on INDIVIDUAL user locations calculate deductibles in form of reimursments or gifts of-some-sort.
i for one think this would be a huge pain in the backside for you guys and unnecessary for either party.
if your country has a 25% VAT and you are buying after general shipping starts (currently it’s supposed to be 31 July) then you will pay 699 + 25% (175 if my math is right) for a total of 875. a few more days and you can get it for 650 + 25% = ~812
Thanks for your detailed insight in your plans.
I read about the VAT thing across EU countries and from outside for this thread. While doing so i came across a paragraph which said you as a firm could only stickt to the vat of your location (germany 19%) if your total export to other eu countries is below 35k or 100k € (the or was in the paragraph with no explanation on which condition) other wise you need to pay the vat of and to the customer eu country. I think with phones and laptops you might cut this quite quickly. So you might wanna lock into this again. I just want to prevent wrong promises here and make you aware of this.
Cross country selling seams a pretty complex thing. Thanks a lot for the effort.
In general:
I think the final thing will be every body in the eu will have to pay his countries vat. If purism dose the shipping purism has to collect it and probably do it according to the customers countries vat.
You are correct with the numbers, but AFAIK these are per country and not in total. Since the majority of the orders came from Germany we should be pretty safe for quite some time. And even if, then the magnitude of orders justify a bit more hassle, which is actually not that bad, you just need to get a tax ID in the country you export into and us this for this country - but then the local VAT rate applies. The German VAT rate is one of the lower VAT rates in the EU so for most countries it will at first be beneficial to have it shipped from Germany with German VAT applied.
To me it was quite clear that the price was without VAT but I am used to international trade where the price always i without taxes - simply because the taxes should be paid in your own country. But within EU we can buy without VAT if we have a VAT number. I have one and I can deduce VAT if I buy from Germany but probably not if I buy from US (I do not know the rules in the US states). For an end consumer it is better to pay German VAT because it is one of the lowest in EU as Nicole indicated. But is would probably also be favourable for me to buy from Germany.
Concerning shipping and handling from and within EUR, like I said, we are actively working on it and I sincerely hope that we will have this sorted out until we start shipping the phone. If plans work out, then we will be able to ship from a place which has a EU VAT tax ID so that businesses within the EU and which also have a valid VAT tax ID can be serviced without charging the VAT first. Also handling of RMAs and service will then be handled within the EU - less hassle, no export and re-import etc.
But why did you state in the 2017 faq that “we will be shipping all German (and hopefully EU orders in general) from Germany.”
Now you say that “we are actively working on it and I sincerely hope that we will have this sorted out” and “If plans work out, then we will be able to ship from a place which has a EU VAT tax ID”.
This is not inspiring confidence.
Nevertheless, wish you all the best.
That is of course assuming the phone is shipped from within the EU. If it’s shipped from the US, then there’s an additional customs fee to be paid. In my country (Belgium), that would be another €30 on top of the 21% VAT, which at current exchange rates adds up to an extra €30 + €123 = €153 ($170) on top of the phone’s $650. So while my VAT rate is 21%, my total extra cost is 26.15% give or take.
And then there’s apparently also an import tax to be paid, although its percentage depends on the type of product in question. And which may also depend on the country of origin. But that database is so convoluted a cat won’t find its young in there, so I was unsuccessful in figuring out how much that would add.
I’m out of my depth here, but presumably this fee is also paid if the phone is imported from the US to Germany, since both Belgium and Germany are members of the European Union Customs Union. So, perhaps we should expect to be charged it regardless.
(Edit: It’s just occurred to me that you might be referring to a fee for processing through customs, rather than a customs charge/import tax, in which case, I suppose it probably varies between countries and import methods.)
You’ve got to be kidding me! How the #### am I supposed to get that kind of money? @nicole.faerber what if I can’t pay for the VAT? I was really looking forward to getting the Librem 5.