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blankseplocked Question about EVE VAT charges and EU directives
 
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Akita T
Caldari Navy Volunteer Task Force
Posted - 2008.02.28 08:08:00 - [1]
 

I have heard from several distinct sources (none of them experts, so the validity is questionable at best) that the EU has reversed some time in the past the VAT directive regarding purchases of electronic services.

I have absolutely no idea wether this is true or not, and to be honest, my "1337 g00gle skillz" have failed me in my search.
BUT, in case this IS true (somebody, link, please, if you can find it), then shouldn't CCP seriously rethink their pricing scheme ?

So... anybody know better ?
Is this reversal true or not ?
And if yes, when did it go into effect (or will go into effect) ?

humperdink
Amarr
Imperial Academy
Posted - 2008.02.28 08:14:00 - [2]
 

Iceland is not in the EU, so it doesn´t matter

Jameroz
Echoes of Space
Posted - 2008.02.28 08:21:00 - [3]
 

I think the main difference is that the customer will be charged VAT based on his/her location. This new change will come to effect in 2015. Laughing

Nofonno
Amarr
Posted - 2008.02.28 08:25:00 - [4]
 

Edited by: Nofonno on 28/02/2008 08:31:30
EDIT: edited for self failure Embarassed

Akita T
Caldari Navy Volunteer Task Force
Posted - 2008.02.28 08:29:00 - [5]
 

Iceland might not be a full member of the European Union, but they are a member of the European Economic Area / European Free Trade Association, which means that financially speaking (for international transactions and such) they are subjected to the same rules a full EU member country is.

What I *did* find was rulings that say the exact opposite of the "rumour", namely that all non-EU suppliers must charge VAT for electronic services when they sell to a customer in the EU.
Nowhere did I find any news of the EU rescinding the VAT for intra-Europeean sales of electronic services, however, EU suppliers ARE exempt from charging/paying VAT for electronically supplied services when they sell outside the EU.

Marine HK4861
Caldari
State Protectorate
Posted - 2008.02.28 08:59:00 - [6]
 

Originally by: Akita T

Nowhere did I find any news of the EU rescinding the VAT for intra-Europeean sales of electronic services, however, EU suppliers ARE exempt from charging/paying VAT for electronically supplied services when they sell outside the EU.



So let me get this straight; Shattered Crystal (and all the other American GTC resellers) should charge VAT when they're selling to Europeans. CCP don't have to charge the Americans VAT on their subscriptions.

Judging from a number of threads on the subject, that's going to really annoy certain people. Very Happy

Akita T
Caldari Navy Volunteer Task Force
Posted - 2008.02.28 09:15:00 - [7]
 

Edited by: Akita T on 28/02/2008 09:15:43
Originally by: Marine HK4861
So let me get this straight
Shattered Crystal (and all the other American GTC resellers) should charge VAT when they're selling to Europeans
CCP don't have to charge the Americans VAT on their subscriptions.

From what I could find on pertinent legislation, yes, that's how it "should" be.
But I somehow doubt the EU could force the guys from ShatteredCrystal to charge VAT.
Meanwhile, what SC does is in a legal grey area (much more black than white, but still not quite illegal, for them).

Call'Da Poleece
Posted - 2008.02.28 09:15:00 - [8]
 

Originally by: Marine HK4861
So let me get this straight; Shattered Crystal (and all the other American GTC resellers) should charge VAT when they're selling to Europeans. CCP don't have to charge the Americans VAT on their subscriptions.

Judging from a number of threads on the subject, that's going to really annoy certain people. Very Happy

I would still buy from Shattered Crystal as it would still be cheaper than € sub

Andrue
Amarr
Posted - 2008.02.28 09:28:00 - [9]
 

Originally by: humperdink
Iceland is not in the EU, so it doesn´t matter
You don't know what you're talking about, that's for sure Rolling Eyes

@the OP - No, there is no such change.

The rules are due to change a bit from 2015 but it isn't a reduction.

Pantaloon McPants
Posted - 2008.02.28 09:32:00 - [10]
 

the only directive they follow in iceland comes direct from starfleet.

Estel Arador
Posted - 2008.02.28 09:32:00 - [11]
 

Originally by: Akita T
I have heard from several distinct sources (none of them experts, so the validity is questionable at best) that the EU has reversed some time in the past the VAT directive regarding purchases of electronic services.

I have absolutely no idea wether this is true or not, and to be honest, my "1337 g00gle skillz" have failed me in my search.



Your "1337 g00gle skillz" may not have failed you at all; after all, it is very hard to find something which does not exist. Given that (1) there's nothing to be found indicating the rumours are true and (2) there is something which indicates the rumours are not true, I'd have a chat with people making the claim/spreading the rumour and explain to them that the burden of proof is on them.

Andrue
Amarr
Posted - 2008.02.28 09:32:00 - [12]
 

Originally by: Akita T
Edited by: Akita T on 28/02/2008 09:15:43
Originally by: Marine HK4861
So let me get this straight
Shattered Crystal (and all the other American GTC resellers) should charge VAT when they're selling to Europeans
CCP don't have to charge the Americans VAT on their subscriptions.

From what I could find on pertinent legislation, yes, that's how it "should" be.
But I somehow doubt the EU could force the guys from ShatteredCrystal to charge VAT.
Meanwhile, what SC does is in a legal grey area (much more black than white, but still not quite illegal, for them).

Actually they could. International trade depends on a large number of international agreements and several of them cover taxation. There are things that the EU could do (if it wanted) to prevent Shattered Crystal from trading in the EU. In theory they could get the US authorities to act.

In practice it's unlikely that the amounts concerned would be worth all the bother but it certainly isn't impossible.

What EU Eve players should be concerning themselves with when buying from a US store is not the relatively small taxation saving. They should be thinking about the 50% reduction in CCP's income resulting from the lousy state of the Dollar.

Akita T
Caldari Navy Volunteer Task Force
Posted - 2008.02.28 09:37:00 - [13]
 

Originally by: Andrue
In practice it's unlikely that the amounts concerned would be worth all the bother but it certainly isn't impossible.

What EU Eve players should be concerning themselves with when buying from a US store is not the relatively small taxation saving. They should be thinking about the 50% reduction in CCP's income resulting from the lousy state of the Dollar.


First part : in not so many words, that's what I was tryng to say too Wink

Second part : actually, it's just about 20-25% tops, not 50%. The rest is VAT, which they don't get to keep anyway.

Malcanis
Caldari
Vanishing Point.
The Initiative.
Posted - 2008.02.28 10:50:00 - [14]
 

Originally by: Andrue
Originally by: Akita T
Edited by: Akita T on 28/02/2008 09:15:43
Originally by: Marine HK4861
So let me get this straight
Shattered Crystal (and all the other American GTC resellers) should charge VAT when they're selling to Europeans
CCP don't have to charge the Americans VAT on their subscriptions.

From what I could find on pertinent legislation, yes, that's how it "should" be.
But I somehow doubt the EU could force the guys from ShatteredCrystal to charge VAT.
Meanwhile, what SC does is in a legal grey area (much more black than white, but still not quite illegal, for them).

Actually they could. International trade depends on a large number of international agreements and several of them cover taxation. There are things that the EU could do (if it wanted) to prevent Shattered Crystal from trading in the EU. In theory they could get the US authorities to act.

In practice it's unlikely that the amounts concerned would be worth all the bother but it certainly isn't impossible.

What EU Eve players should be concerning themselves with when buying from a US store is not the relatively small taxation saving. They should be thinking about the 50% reduction in CCP's income resulting from the lousy state of the Dollar.


Why should the EU customers be concerning themselves about CCPs fall in income when it's the US players that are paying 1/3 less?

Semkhet
Dark Tornado
Ethereal Dawn
Posted - 2008.02.28 11:17:00 - [15]
 

Edited by: Semkhet on 28/02/2008 11:20:21
Originally by: Akita T
I have heard from several distinct sources (none of them experts, so the validity is questionable at best) that the EU has reversed some time in the past the VAT directive regarding purchases of electronic services.

I have absolutely no idea wether this is true or not, and to be honest, my "1337 g00gle skillz" have failed me in my search.
BUT, in case this IS true (somebody, link, please, if you can find it), then shouldn't CCP seriously rethink their pricing scheme ?

So... anybody know better ?
Is this reversal true or not ?
And if yes, when did it go into effect (or will go into effect) ?



That's what you are looking for. I had in the past a clash with a company that billed me a reservation and when I cancelled, they didn't want to refund according to the rights I enjoy under the law which govern my country of residence in the EU and answered arrogantly that EU law didn't apply in the US. Yeah right, like if you buy a trip to NY from Germany, it's german law which will apply in NY... Rolling Eyes. The company was based in the USA, but operates all over the EU.

Since the transaction took place on the net, checked the relevant legislation and found out that they were operating illegaly within the EU since they didn't have a due VAT registration. Needless to say, getting back to them, I suddenly got my funds back no questions asking Wink

The relevant info you're looking for: European Value Added Tax (VAT) and the Internet. If you want more information just Google "Council Directive 2002/38/EC".

Excerpt:

The EU "E-Business Directive" (Council Directive 2002/38/EC) came into effect on 1st July 2003. The effect of this directive is to implement the imposition of VAT in on Internet delivered information or services within the EU. This amounts to a tariff of between 13 and 25 per cent on items such as software or music downloads, any transactions as part of online auctions and subscriptions to internet service providers, sold over the internet anywhere within the European Union.

This Directive applies to non-EU companies and thus if your company is based outside the EU and providing Internet delivered information or services within the EU you should read this as failure to register and account for VAT could render you or your company liable to criminal prosecution for tax evasion, money laundering, false accounting or similar offences.


Akita T
Caldari Navy Volunteer Task Force
Posted - 2008.02.28 11:26:00 - [16]
 

That's exactly the directive I was talking about, but the outrageous claim I've heard from several people was that it was REVERSED.
So far, nobody has been able to provide a link to substantiate that claim, but increasing number of people (including here, on these forums) claim otherwise.

Roy Gordon
Caldari
Caldari Advanced Response Division
Power Of 3
Posted - 2008.02.28 11:49:00 - [17]
 

On a similar vein, from my investigations into various EU directives it would appear that you cannot charge VAT on card games. I have successfully refused to pay VAT on various card games I have purchased in the past by quoting various directives. This directive also applies to the Eve card game. Have a look at my post on the card game section of this site for further details.

ApaKaka
Lone Starr Corporation
Posted - 2008.02.28 12:00:00 - [18]
 

By any sense of that logic, EVE should charge more in the American currency, since that's the currency that's devalued compared to the Euro.

The Euro has been pretty stable since its inception, which is why that should be the guiding price-index for EVE (and for oil, and international transactions, you name it, etc)

But, I bet that's going to peeve a lot of americans instead, and nobody's going to be happy except CCP who just got 50% more margins to play with Laughing


 

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