PDA

View Full Version : Game companies chargin VAT to EU people

EJSainz
02-02-2006, 09:44 AM
Hello,

I'd like to share my opinion about a fact I fell totally unfair: I recently bought Plantasia from PlayFirst, and I got charged VAT over the US price. That is, 19,95$ * 1,16 = 23, 42$, 20€ more or less.

The problem itself is not that they are chargin VAT: new laws say so, and somebody has to pay. The problem is that, I as an european, wouldn't charge any VAT to my US customers as this is an exportation. Aren't there any US taxes in those 19,95$ that should only be payed by US consumers? If so, why am I paying them?

I hope some of you can bring some light about this. Right now Euro is stronger than Dollar, but, could it change in the future, I'm definitelly not paying more than 20€ for a downloadable game.
Mike Boeh
02-02-2006, 09:55 AM
The problem is that, I as an european, wouldn't charge any VAT to my US customers as this is an exportation. Aren't there any US taxes in those 19,95$ that should only be payed by US consumers? If so, why am I paying them?
You are paying them because the EU requires American companies to collect VAT for European customers, and then pay the EU that money... The US has no such law for European vendors, nor should they. There are no taxes in that $19.95. The customer will only pay US sales tax if they live in the same state as the vendor.

IMO it's completely ridiculous for the EU to do this, not to mention they have no real way to enforce it. But they do it, and most E-Commerce vendors in the US comply.
mahlzeit
02-02-2006, 10:27 AM
It has always worked that way for physical goods. When you imported a CD or a book or whatever, you already had to pay VAT on them. The "new" law (already two and a half years old) just extended it to downloads.

Basically, if you are an EU customer, you always have to pay VAT on anything you buy, no matter where you buy it from.

The only ones it is unfair to are the non-EU vendors who are not "forced" to comply even though the EU has no jurisdiction over them. Of course, I'd prefer not to pay this tax too, but hey, only death and taxes.