As if COVID wasn't enough, the international cultural sector is getting another stab. This time from the European Union.
As of July 1st, customs’ laws in Europe change : EVERY package coming from outside the European Community will be taxed.
For the moment, there's the exception of goods with a value below 22 euro.
I've got not problem with the fact that every package will be taxed.
VAT needs to be paid in the country where the goods are consumed.
I do have a problem with the flat fee handling cost and with the VAT being be calculated on the package plus (!!) shipping costs...
Let me explain :
In Belgium, there will be a flat customs’ fee of 30 € with on top VAT on the total value of the package.
(value = value package + postage paid !?! How's that for a math exercise??)
Combined with the new shipping rates that are appearing everywhere, this just might be one bridge too far.
Example : a book or CD of 14 € sent from the USA or UK to Belgium (postage around 16 €) will cost you in the end : 14 (item) + 16 (shipping) + 30 (custom handling) + 6 (vat) = 66 €.
In theory, it should only be 14 + 16 + (14*.21) = 33 €.
To quote one of my pals: "Diabolical and outrageous".
In practice, smaller shops, distributors, independent and DIY artists will no longer be able to send goods with a value below 22 euro into the EU without the customer having to pay a lot of extra costs.
Unless :
https://ec.europa.eu/taxation_customs/business/vat/vat-e-commerce_en
Online sellers, including online marketplaces/platforms can register in one EU Member State and this will be valid for the declaration and payment of VAT on all distance sales of goods and cross-border supplies of services to customers within the EU.
I can imagine this will be no problem for the bigger players, but I'm curious to find out how smaller distributors or artists selling their material through their website, Bandcamp or Discogs will cope with this.
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