Post-Brexit VAT & Duties Changes

Fab3rge

Hi all,
I have ordered a board game online (via Kickstarter) and the board game company are now trying to charge me (and the other UK backers) 20% extra for more VAT “thanks to Brexit”. Although the UK tax department tell me the only thing that is affected by Brexit is trade tariffs - not VAT. 

The game is coming from China via EU, produced by a company in Wilmington, Delaware, USA. It has a “pledge” value of £150 (that includes delivery - until now, anyway).  It’s predominantly card based, however I have ordered games of all sizes and materials for future delivery (most from US firms but some EU firms, all from China via EU). I want to be in the know for the next time a company tries to slap extra charges on me. 

HMRC told me I needed a trade tariff code for what board games fall under. It’s not on the list on the Tax website - perhaps “board game” is too vague? (maybe I just missed it- it’s a long list).

I’ve contacted the UK trade tariff department but I’ve had no reply, and nobody at the tax office seems to understand taxes... (go figure). 

Can someone please explain how taxes and import duty are going to be affected post Brexit, in plain, simple English? 

Thanks!!

Grumpy_chap

Fab3rge said:

Can someone please explain how taxes and import duty are going to be affected post Brexit, in plain, simple English? 

No.  Nobody knows - it all depends on what is in the deal, or no deal.

EDIT:  Maybe MSE Forum needs a separate area for Brexit issues, as this is not really Coronavirus-related.

superbigal

You have always had to pay Import VAT And Import duties when importing goods from outside the EU. (Over a certain Value)
Nothing has changed.  
Imports from the EU were exempt of both via Article 138 of the EU Vat Directive.  If you were Vat registered.
Deal or no deal you will now have to pay Import Vat on goods from the EU.  You may of course be able to reclaim or defer if you are Vat registered.

Fab3rge

Awesome, thank you all for the info. 

I’m not shocked at paying a bit more, maybe 5% (as EU VAT is 15% and UK VAT is 20%), but 20% extra just sounds wrong. I’ll check again in the new year, after a deal/ no deal has been announced. Trying to find information on taxes and import duties is so complicated for most people. Perhaps it is a complicated matter 😅

Jeremy535897

I referred another poster to this:
https://www.nintendolife.com/news/2020/11/watch_out_europe_-_importing_consoles_from_the_u_s_just_got_a_lot_more_expensive

I don't know whether the same point applies to your game.

superbigal

https://www.trade-tariff.service.gov.uk/sections
Will give you an idea of any import tarrifs from the EU in event of no deal.   This list in effect "should" apply to all your Chinese imports currently.   Clearly most Chinese sellers are adept at "bending" the paperwork.

Fab3rge

All this information is superb, thanks so much. I do not know how companies can claim ignorance for tax differences, and expect consumers to cough up. If a retailer phoned me up and asked for an extra 20% after I had bought something, I would think it was a joke - so why is it any different for online orders? Surely they should be held accountable for their mistakes/ errors.

Fab3rge

From what I gather, the EU/ UK are taxing heavier on products from USA (even though they're made in China...), and vice versa, stemming back from USA disapproving of EU subsidies of Airbus (circa 2018). And there's not a lot we can do about it. Could be worse. Sounds like the electronics industries for both sides getting hammered (Asia should profit from that, ironically, seeing as the whole World thinks China is taking over).

DiamondLil

Fab3rge said:

All this information is superb, thanks so much. I do not know how companies can claim ignorance for tax differences, and expect consumers to cough up. If a retailer phoned me up and asked for an extra 20% after I had bought something, I would think it was a joke - so why is it any different for online orders? Surely they should be held accountable for their mistakes/ errors.

To be fair, if a resident of, say, the UK doesn't understand the tax laws of the country he is a resident of, we can hardly expect businesses in other countries to understand our tax laws.

Thrugelmir

Fab3rge said:

 I do not know how companies can claim ignorance for tax differences, and expect consumers to cough up.

If you import goods then doesn't mattter if you are a business or a consumer. You will be subject to the same tax laws that have been in place for many many years. Up to the individual to educate themselves. 

superbigal

The Chinese tend to "under value" items on the Customs declaration/commercial invoices.
I have bought goods for the business worth £1,000s of pounds.  I am 100% okay with paying 20% Import Vat as I claim it back.
The sellers persist in thinking they are "helping me" by declaring the goods at ridiculously low levels.
Import duties are often Zero Rated so the value is irrelevant.
I continually have to tell them to declare the true value.
Obviously for non vat individuals you may be delighted by the Import Vat evasion methods of some suppliers.