Anyone know why

Started 8 months ago | Discussions thread
dannybgoode
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Re: Interesting attitude towards taxes ...
In reply to deednets, 8 months ago

Here in New Zealand there are many people now asking as to how online retailers from overseas can be taxed (we have GST like the UK has VAT, quite substantial tax, 15% here and I believe 20% in the UK??). There is actually quite a bit of sympathy for brick & mortar shops here, that don't have a choice. Ony the most (tempted to use the term selfish, but that is of course never the case, right??) cleverestest people think that this is the way to go, get over it, only idiots pay taxes! We had this change of some wedding gown shops charging for trying dresses on, some of them wanted up to 100.00 for trying and customers were disgusted - until there was an article in the paper that it now is common practise to try the dress on in the shop - and then buy online, no taxes, no shop front ... makes me quite angry this, but apparently this is the way to go, right?

Deed

VAT is indeed 20% in the UK.  People forget over here when comparing to US prices that most US prices shown do not include the sales tax whereas the UK prices do.

Online retailers such as Amazon have always charged VAT to consumers - the big argument over here is how much they pay in business taxes to the UK exchequer as they base themselves offshore to avoid a lot of the money that a UK based (usually bricks & mortar shop) have to pay to operate.

There was a big enquiry and Google, Starbucks, Amazon and others had to appear before MP's.  All perfectly legal of course - accountancy firms specialising in tax law are big business! - but it caused a bit of a stir for a few weeks.

The loophole until recently were firms based in Guernsey and Jersey when on lower cost items VAT was not chargeable.

Amazon (and others - Play.com for eg) set up there and would sell things like CD's, computer games, books etc and sold them less the VAT but that loophole has recently been closed so in terms of VAT it is now a pretty level playing field but in terms of company taxes the online retailers still have an edge.

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