back to article Online VAT fraud: Calls for government crackdown grow louder

Calls to crack down on companies selling goods online in the UK without declaring VAT have gathered pace, with a peer and another high profile individual now voicing their concerns that the practice is damaging UK business. The Register has previously reported on the seemingly growing number of sellers based outside Europe who …

  1. JakeMS
    Headmaster

    Let's talk VAT numbers..

    It seems a lot of people tend to misunderstand the way the VAT system actually works in the UK.

    Often you may see 'sellers' who do not have a VAT number.

    This is very true for small businesses, for example if you have less than £75,000[1] of pure profit per year you are not required to have a VAT number at all. Although they can opt to get a VAT number anyway.

    However what this means is that if they should choose to not register a VAT number it simply means that when they get the items in stock the VAT is paid by the seller to the wholesaler, thus VAT has indeed been legally paid for the sold goods.

    This means that yes, they do not have to list the VAT included or their VAT number when they sell an item. In this instance no laws have been broken what-so-ever.

    Typically accountants will push for you to get a VAT number so you can get your stock cheaper without VAT. But this will often mean you get a VAT bill at the end of the year. However, without a VAT number you simply pay the VAT up front straight away. Thus no end of year tax bill. Heck you may even get money back!

    So long as the business is registered with HMRC, your accounts are put in each year and you are earning less than 75k a year in profit, you are breaking no laws by having no VAT number.

    [1] This figure may have gone up or down since I last checked..

    1. Dave Horn

      Re: Let's talk VAT numbers..

      The argument made here is that items are being sold at a price that would be loss-making if VAT were paid by the seller to the wholesaler.

    2. Carl W

      Re: Let's talk VAT numbers..

      It's not profit, it's turnover. And I think the number is about £80k now. Don't need to sell many iPads to reach £80k of turnover

    3. xj650t

      Re: Let's talk VAT numbers..

      VAT registration is based on turnover (net sales) not profit, and the threshold for this year is £81K

      1. Roland6 Silver badge

        Re: Let's talk VAT numbers..

        VAT registration is based on UK turnover.

        If much of your business is export, HMRC will happily set a higher threshold for registration. A friend has just gone through all of this (with HMRC) and hence is now confidently trading above the £80k mark because his UK business is sub £80k.

    4. d3vy

      Re: Let's talk VAT numbers..

      @jakems

      This is 100% right so long as the supplier and the wholesaler are in the UK and VAT is paid on the stock...

      I think the issue here is non UK companies buying stock abroad (no vat) shipping it over and selling it in the UK without VAT, which UK based companies cannot do (legally)

    5. gerdesj

      Re: Let's talk VAT numbers..

      VAT registration requirements are based on turnover and not profits. https://www.gov.uk/vat-registration/when-to-register You generally pay it quarterly in arrears and not annually.

      Just in case anyone is in any doubt: Turnover not Profits

    6. Data Mangler

      Re: Let's talk VAT numbers..

      "for example if you have less than £75,000[1] of pure profit per year you are not required to have a VAT number at all."

      It's got nothing to do with profit. It's on non-VAT exempt turnover. The current UK threshold is £82,000.

      See: https://www.gov.uk/vat-registration/when-to-register

    7. quattroprorocked

      Re: Let's talk VAT numbers..

      Turnover.

      VAT is based on turnover, not profit. So when it comes to selling shit, anyone running a business producing even close to a single salary at normal retail margins would need to be VAT registered.

    8. Colin McKinnon

      Re: Let's talk VAT numbers..

      Hm.

      Sad that everyone here is quibbling over the precise thresholds for compulsory VAT registration and ignoring the fact that treating sellers without VAT numbers as potential criminals demonizes very small businesses and private individuals.

      Whats to stop the government legislating to require payment processors to notify them of VATable transactions?

    9. jonathanb Silver badge

      Re: Let's talk VAT numbers..

      The registration threshold is based on turnover, not profit, and is £82,000 for UK businesses, or £70,000 for businesses that are registered for VAT in another EU country, and exporting to the UK.

  2. Anonymous Coward
    Anonymous Coward

    Ugh

    Why not just ditch VAT? Legalise some softer drugs and tax those.

    We'd save a fortune on civil servants wages and pensions.

    While we're at it, scrap road tax and add it to fuel.

    Its not just VAT that is the problem, thats just a bonus to the offshore firms. The administrative burden is also lower overseas.

    The admin processes in blighty appear to be designed to increase mistakes as well.

    Anyone seen the "amount of tax to be claimed from or owed to HMRC" box on the VAT forms?

    Hell, in the BVI there is no admin overhead.

    1. AMBxx Silver badge

      Re: Ugh

      Great idea - I sell a small amount of software to other companies in the EU. No VAT, but I still have to fill out an extra form just so that internal trade can be tracked. If I get it wrong, I get a fine.

      Achieves nothing but keeping public sector folk in employment.

    2. d3vy

      Re: Ugh

      Scrap road tax?!?

      I think you'll find the government about 90 years ahead of you on that one.

      1. jonathanb Silver badge

        Re: Ugh

        I think you will find that road tax was re-introduced in the most recent budget.

        1. Anonymous Coward
          Anonymous Coward

          Re: Ugh

          As @Kubla rightly says, VAT is very cheap to collect, certainly a lot more so than income tax.

          Doesn't mean it couldn't be done better though but having run a small VAT registered business in the UK I didn't find it too onerous.

          What we do need is HMRC to start taking action about this. I find it hard to see why there's more of a problem today. the goods are physical so they don't arrive in the country by magic. The only things that's changed over the last 25 years is that there are more alternatives to post goods. It used to be that HM C&E could set-up base at the Post Office, like LOMO and check what was going on. Now there are multiple points of entry... still nothing beyond the wit of man!

    3. Kubla Cant Silver badge

      Re: Ugh

      Why not just ditch VAT?

      Because it's a very cheap tax to collect. This is obviously attractive from the government's point of view, but it's also a benefit to us as tax-payers. If the government needs £20k of my income to spend every year, I'd far rather pay an extra £100 for collection costs than an extra £1000.

      This factor is generally overlooked by people devising complicated "fair" taxation schemes. They may be more equitable, but we're all worse off because of the money wasted on collection.

  3. JimmyPage Silver badge

    Of course, they could just pass a law

    requiring*eBay* (et al) to collect the VAT.

    Although as someone who used to receive C&Es (now HMRC) quarterly billet-doux with such groundbreaking decisions about what was and was not exempt (bear in mind the pasty tax uses mean ambient temperature as a threshold) I would pity eBay.

    Presumably eBays *fees* include VAT ?

    1. therebel

      Re: Of course, they could just pass a law

      The eBay fees do include vat.... at the Luxemburg rate which I think may be 15%. Much like Amazon they collect it but do they pay it over to the Governments there.

  4. codejunky Silver badge

    Hmm

    Paying tax damages the business. Not a surprise. I am not a fan of VAT as it hits the poor and I think is a good cause for the black market. However it seems some sort of sales tax is considered an economically good tax so maybe I am wrong. I do think it is damaging to economic growth as the argument when Brown reduced it to stimulate the economy (for a short time) and the complaints when Osborne upped the cost to people by an additional 5th of the price.

    1. codejunky Silver badge

      Re: Hmm

      Lots of thumbs but no fingers to type a response? An explanation? I would love to know why VAT is a good idea against the concerns I have mentioned. Or is this a tally of people who like higher prices than the value of the product?

      1. Turtle

        @codejunky Re: Hmm

        "Paying tax damages the business..." that has to both pay tax, and compete with businesses that don't.

        1. codejunky Silver badge

          Re: @codejunky Hmm

          @ Turtle

          I dont dispute that. I also point out that by reducing the tax Brown shouted about stimulating the economy because the gov was taking less money out of the economy (by bumping up prices). And there was the discomfort of this gov raising the price of almost everything by increasing VAT.

          I am not trying to defend tax avoidance, I am asking why VAT is considered such a good tax when it harms the poor and damages the economy.

          1. Quip

            Re: @codejunky Hmm

            @codejunky

            "I am not trying to defend tax avoidance, I am asking why VAT is considered such a good tax when it harms the poor and damages the economy."

            [Sounds like a request for another article from Tim Worstall.]

            The classic definition of a 'good' tax —from the tax collectors point of view— is that it should be easy (ie cheap) to collect, hard to avoid, and not distort behaviour. This is something of a a "pick any two" requirement. Especially as politicians and 'campaigners' rather like taxes that do anything but meet the third criterion.

          2. Ben Tasker Silver badge

            Re: @codejunky Hmm

            > Brown shouted about stimulating the economy because the gov was taking less money out of the economy (by bumping up prices)

            It stimulated the economy because it made things a little cheaper, so people were more willing to spend on "impulse" buys (i.e. something you don't need but not necessarily a luxury).

            > And there was the discomfort of this gov raising the price of almost everything by increasing VAT

            That's less about VAT itself, and more that people don't like when the price of things rises. People can grumble all they want, it does no harm to the economy so long as they continue purchasing at the newer higher point

            > I am not trying to defend tax avoidance, I am asking why VAT is considered such a good tax when it harms the poor and damages the economy

            As others have pointed out, VAT is a cheap tax from the collections point of view. Whilst making people more willing to spend by lowering VAT can give the economy a boost, it also means a drop in income to the Government, increasing the deficit. The two need to operate in some semblance of balance.

            There's also the argument that (just as we saw with fuel a while back), if you remove VAT entirely, retailers will just up their prices. A commodity is worth whatever someone is willing to pay for it, if we've been paying £6 inc VAT for something, and VAT is abolished, there's no reason (OK, some brief public upset) a retailer couldn't move to just pocketing that extra 20%.

            IMO, VAT is a far better tax than some of the other taxes we have to deal with, V.E.D being one that should be binned and replaced with something more VAT like (i.e. move it into fuel duty).

            1. codejunky Silver badge

              Re: @codejunky Hmm

              @ Ben Tasker

              "It stimulated the economy because it made things a little cheaper, so people were more willing to spend on "impulse" buys"

              So for those who had the slightly extra spare cash they spent it which provides more money to the retailer which makes its way to workers. And you have those without the extra spare cash being able to afford enough (or nearer to enough) because the gov isnt appending additional cost.

              "That's less about VAT itself, and more that people don't like when the price of things rises. People can grumble all they want, it does no harm to the economy so long as they continue purchasing at the newer higher point"

              Unfortunately this statement is incompatible with your first. Either the economy is stimulated by reduced price or people will continue paying at the higher point. The only way I see higher prices being paid is if income increases too, but artificially inflating prices with tax does not (and cannot) inflate the wages to do this. Some people dont like a price rise. Some people cant afford it.

              "As others have pointed out, VAT is a cheap tax from the collections point of view. Whilst making people more willing to spend by lowering VAT can give the economy a boost, it also means a drop in income to the Government, increasing the deficit. The two need to operate in some semblance of balance."

              The ease of collection I accept as the best reason I have heard so far but this ease attacks the poor. When we talk of tax money we talk of emotive services like NHS or education etc which all suffer the same problem of declining performance as politics increases the cost and reduces the output. And of course this ignores the duck houses, second houses, porn and other perks of milking the tax payer. The size of the public sector has ballooned and so has the cost during a boom, so balance should surely follow the same principals of reducing the expenses in a recession. And reducing the expenses of the poor should reduce the dependency of the poor (the poverty trap).

              "There's also the argument that (just as we saw with fuel a while back), if you remove VAT entirely, retailers will just up their prices. A commodity is worth whatever someone is willing to pay for it, if we've been paying £6 inc VAT for something, and VAT is abolished, there's no reason (OK, some brief public upset) a retailer couldn't move to just pocketing that extra 20%."

              Thats fine, that is a good thing. Look at Tesco now. They had a great profit margin which has not only been slashed but decimated quickly due to the recession. pre the recession the poor had access to quality knock-off like products from the bargain stores. Due to the recession more people moved from the profiteers to the low cost offering and have forced even the big stores to reduce prices (even to make a loss). The market adapts to the situation. At the same time the gov (artificial prince inflation) upped the VAT to take more from the people.

              "IMO, VAT is a far better tax than some of the other taxes we have to deal with, V.E.D being one that should be binned and replaced with something more VAT like (i.e. move it into fuel duty)."

              You hear no argument from me. And over labours term so many people were pushed into higher tax brackets because they had more money. But the value of their money didnt go up which has caused people who shouldnt have been paying tax to be forced into paying tax or into higher brackets. I would love for the tax laws to be simplified and for the poor to pay no tax.

  5. Herby Silver badge

    We do this all the time in the USA

    You see, we have sales taxes (similar to VAT) in many (but not all) of the United States. A supreme court of long ago, says that if you aren't doing business in a particular state, then you don't need to collect its sales tax. So, lots of people here in the fine state of California which charges around 8% sales tax (it varies) shop out of state (ebay works as well) and just let them ship it to the nice sunny California address.

    There have been many attempts to tax internet sales, but it seems that people don't want it done. I wonder why?

    The bummer is that Amazon does have a facility here in California, so they charge sales tax. Yuck.

    So, if one can avoid tax, do it (like everyone does!).

  6. JimmyPage Silver badge
    Mushroom

    The logical conclusion, (of course)

    is an endpoint where all taxes are equivalent. No one loses, no one wins.

    Of course, as the EU so clearly demonstrates, where there is monetary union, can political union be far behind.

    Of course, if there are people who don't want this, then it needs to be considered how people *oppose* political unions ---------------->

  7. Steve Davies 3 Silver badge

    Ordering 'stuff' from outside the EU

    Ok hands up how many readers here have ordered stuff from outside the EU and found that VAT was added to the price you paid?

    Hands up again, how many have wondered if said VAT was actually send to the relevant Tax collection authority (HMRC in the UK)

    Then there is the reverse swindle where the likes of Amazon insist on charging you VAT even if you make a purchase when you are outside the EU which makes them a clear 20% profit or do they actually send it to HMRC?

    This whole area is a minefield. Good luck sorting that one out.

    1. Anonymous Coward
      Anonymous Coward

      Re: Ordering 'stuff' from outside the EU

      VAT should be charged at the point of sale.. If you buy from a company with a UK presence, UK stock and pay in £ you should be charged VAT, the supplier should declare it and pay it on to hmrc.

      If you buy from abroad you don't pay VAT but may be charged an port duty.

      Sorted, if I was kind of the world it would be so much simpler. :)

      1. James 100

        Re: Ordering 'stuff' from outside the EU

        The previous post was talking about "if you make a purchase when you are outside the EU", where of course no VAT should apply, only sales tax (or whatever is appropriate), since they're exporting it to you. Apparently people in Jersey often have a problem explaining this to UK mail order vendors, since they're outside the EU and so shouldn't be subject to VAT.

      2. Anonymous Coward
        Anonymous Coward

        Re: Ordering 'stuff' from outside the EU

        Sorted, if I was kind of the world it would be so much simpler.

        Maybe so, but you can't make an omlette without breaking a few eggs, and in this case the eggs to be broken include all of the EU laws, conventions and agreements that support cross border trade, all of the bilateral trading agreements reached with various countries, plus you'd need to close loopholes that would exist from or through (eg) Isle of Man, Channel Islands. And you'd need a new and very effective system to monitor and administer all incoming air mail, all trucks, containers, post, courier etc etc.

        1. Dominion

          Re: Ordering 'stuff' from outside the EU

          What Amazon is doing isn't cross border trade. You buy "stuff", it gets shipped from a warehouse in the UK, the same as if you walked into a shop and bought it. The "stuff" has never been anywhere near Luxembourg, so anybody claiming that the "transaction" took place abroad is simply taking the piss.

  8. Roland6 Silver badge

    Don't know about on-line VAT fraud but...

    I have noticed how many marketplace sellers on Amazon.co.uk and ebay.co.uk now ship from China, whilst seemingly to be a UK trading entity. The only indication being the delivery time estimate for Royal Mail, with no option to upgrade to a faster delivery service. Only by drilling down into either the seller or shipping details do you find that the good will be shipped directly from China, often from a company with a different name to the seller...

    1. Sam Liddicott

      Re: Don't know about on-line VAT fraud but...

      This is the behaviour that VAT incentivises.

    2. Anonymous Coward
      Anonymous Coward

      Re: Don't know about on-line VAT fraud but...

      On eBay you find apparently Chinese companies with UK stock as per the article. What is interesting is the number of sellers who all have the same UK town as the shipping location. Either someone has a business acting as their UK warehouse agent official - or is a speculative reseller - or the various sellers' names are actually owned by the same overseas company. It is possible they might pay vat - the prices tend to be considerably higher than the identical product ordered from overseas.

      Even some British sellers seem to hide behind multiple different sellers' names - while the product and shipping location details are identical.

      1. Wensleydale Cheese

        Re: Don't know about on-line VAT fraud but...

        "Even some British sellers seem to hide behind multiple different sellers' names - while the product and shipping location details are identical."

        That one can be explained by wholesalers who will ship direct to the end client.

        It saves the resellers the hassle and cost of handling the physical goods themselves.

    3. Anonymous Coward
      Anonymous Coward

      Re: Don't know about on-line VAT fraud but...

      I don't know if you're behind times, or whether it's me, but I have noticed that many "uk" (not) ebay and amazon sellers ship from the... UK, usually (if not always) from some shitty mailbox service place, or a bedsit. I assumed it was because too many would-be customers started asking them awkward questions like, "what happens if the shiny-shiny I paid for gets stopped by UK customs", or "where to send my shiny-shiny for repairs if it dies under warranty" or, "I'd love to buy from you as you have great prices, but I can't wait for my shiny-shiny for x days! I want it NOW!!!!!!".

      A solution: a "UK presence".

      All that said, in fact _I_ might be behind times myself, as the retailers big and small have been probably feeling the pain of Chinese sellers and putting pressure on politicians big and small, to plug the hole (probably lying through their teeth showing they're law-abiding business, employing XXX thousands of UK hard-working citizens, and the only thing that makes up a difference between their statospheric pricing and cheap e-bay pricing is those taxes they pay).

      So yes, there's been some pressure on ebay to clean up their act (ebay: us? profiteering?! Never!), by ebay forcing "uk sellers" to display their vat numbers (other than fake vat numbers). So, perhaps some of those Chinese shops decided now it's easier, after all, to go back to China, ship from there (free of charge) and make the punter deal with VAT and customs charges (without shouting about it at their listings). Sort of short-term hit and run scam, but with a large turnover... it might work, for now. Definitely a few "uk" electronics etailers proudly displaying UK flag and dropping the right hints here and there - ship from China, but you only find out where you dig REALLY deep into their website...

  9. Commswonk Silver badge

    The money has to come from somewhere...

    Like it or not the UK government - like governments everywhere - needs money, and given that there is no such thing as a Magic Money Tree the only way it can get it is via taxation. Without that money how could things like the NHS, education, the Fire Services and the Police and so on (and on...) ever be funded?

    If VAT didn't exist then the money raised would have to come from other sources; how many here would put up their hands for (much?) higher income tax? I am not a "tax and spend" enthusiast!

    I get a bit twitchy when I read statements like Paying tax damages the business because this seems to suggest that "business" should be given a free ride. Doubtless some businesses would argue that they shouldn't have to pay for their heating and lighting on the grounds that "it damages the business". I don't doubt some might even claim that paying their staff "damages the business", but they get around that one by using zero - hours contracts instead. (For the avoidance of doubt I deprecate the use of this ploy as a means of keeping wages down.)

    If HMRC decide to focus on people who ought to be paying tax but aren't (possibly by not admitting to being a business when in fact they are) then that's fine by me. I'd be even happier if they could make sure that Corporation Tax was paid in full , rather than negotiating discounts over cosy lunches. If I discovered that HMG was working with others to ensure that large international companies paid their tax (rather than moving it around the globe with one hand while giving us 2 fingers with the other) then I'd be even happier still.

    If people are trading on ebay / Amazon and the like while not owning up to being businesses then as far as I am concerned they are fair game for the attention of the tax man. in any case it's not the business that has to meet business costs - it's the customers, and businesses should set their charges to suit.

  10. Anonymous Coward
    Anonymous Coward

    Rules

    It would help if the exemption that having warehouses in a country does not count as a presence, this being the rule Amazon use to claim they aren't a UK company.

    I've dealt with US sales tax before and recall that they have a much tighter definition of presence, though the invoice processing rule was a pain, basically ship product from CA to NY, but head office of buying Corp is in CA and has central Payments so have to treat as a CA transaction with sales tax not sale to NY with no sales tax.

    Definitely need simpler tax systems

  11. Skeptically

    Its a scam. I bought a replacement laptop screen on Ebay. Great price. After I ordered it I saw that I had been dealing with a Chinese company yet the screen was despatched from a UK warehouse. That is why it was cheaper than the UK based suppliers who have to pay VAT. The money goes directly to China and the UK operation may well be only a garage full of stuff shipped out to them by a container. Local suppliers who pay VAT lose out on unfair business practices and HMRC loses tax. We all lose but the scammers win.

  12. Quortney Fortensplibe

    "...Its a scam. I bought a replacement laptop screen on Ebay. Great price..."

    "...We all lose but the scammers win..."

    So, who got scammed? You [The customer] got your goods at a "great price". The seller presumably made a profit. As did the manufacturer. The only ones who seem to have lost out on the deal are the blood-sucking leeches at HMRC. And, fuck them, basically.

    1. Dominion

      Yeah because tax isn't used for useful stuff like healthcare, education etc...?

    2. VATFraud

      Shoot sighted

      Chinese sellers with stock in the uk, committing vat fraud and laundering billions out of UK economy are not only defrauding HMRC.

      They are taking all sales alway for uk companies like mine.

      My company is on the verge of bankruptcy because we can no longer compete on price with vat evading Chinese sellers with stock in Uk

      Perhaps you should share your views with all the staff and their families that I have just made redundant.

      I am sure they will be comforted by them

  13. Commswonk Silver badge

    Er... no.

    The only ones who seem to have lost out on the deal are the blood-sucking leeches at HMRC. And, fuck them, basically.

    Ultimately the ones who lose out are the the people who rely on tax receipts; the people.

    Dear Claimant,

    We are sorry to inform you that because of persistent evasion of VAT and other taxes there is insufficient money to pay you any JSA / Child Tax Credit / Disability Living Allowance / whatever / this month.

    Life's a real bitch, innit

    Love from

    HMRC.

    Similar letters will be sent to those needing medical treatment, education for their children and so on, including dispatching the Fire Brigade when their house is on fire.

    That's the result of your And, fuck them, basically.. Is that really what you intended?

    1. Anonymous Coward
      Anonymous Coward

      Re: Er... no.

      "Similar letters will be sent to those needing medical treatment, education for their children and so on, including dispatching the Fire Brigade when their house is on fire."

      Alternatively they make up the shortfall by increasing the taxes that we the general public cannot avoid paying.

      Having said that - the tax laws in the UK appear overly complex. That encourages those who can afford to employ accountants to try to (legally) game the system.

      HMRC makes it difficult too. I've been trying to get a P810 to request a refund of higher rate tax as I made a big donation to a charity last year. That would also inform HMRC of the amount I received from interest on my life savings last year. The phone line keeps you waiting - then cuts you off. You can't fill in an online version of the form - nor print one off. Shirley they aren't gaming the system themselves?

  14. Quortney Fortensplibe
    Facepalm

    "..:Yeah because tax isn't used for useful stuff like healthcare, education etc...?..."

    ...and for sucking Team USA's arse around the globe, in a succession of illegal and crisis-worsening military campaigns... and on Trident and similar toys, which give politicians and generals hard-ons.

    If we spent a bit less on 'willy-waving' tripe like that, we could all pay less tax and there'd still be enough revenue to fund the NHS and education etc. properly.

    But you go on believing the government line that the taxman only has his hand in your pocket from cradle to grave [and beyond] just so granny can have a new hip and little Jonny can go to a lovely well-equipped school.

    The fact that the people who are spinning you this line use private medical care, send their children to public [ie. private] schools, have offshore bank accounts and pay teams of accountants to make sure they pay as little tax as possible shouldn't lessen YOUR intention to pay as much as YOU can. It's your patriotic duty to be bled dry!

  15. VATFraud

    NON UK Companies with stock in Uk

    All non UK Companies with stock in UK need to register for VAT when they make their first supply of goods in the UK

    There is no Vat threshold

    This systematic abuse of this Vat law has led to a significant distortion price in the uk & eu marketplace through vat abuse which has led to Vat registered businesses unable to compete on price.

    HMRCs continued systematic failure to enforce compliance of EU Law regarding sellers obligations to display VAT numbers is fuelling VAT fraud and abuse on e-marketplaces such as Amazon and eBay which is continuing to grow at a near expotential rate.

    The EU are introducing new regulations which will mean any goods being sold in the eu or uk will include Vat.

    So if a Chinese seller distant sells to Uk customers, dispatching their stock from China they need to reigister for vat in the UK. All parcels entering uk through customs will need to display vat number on the outside of the parcel. If a parcel does not have a vat number it will be returned to sender.

    A Chinese seller dispatching stock from uk with out registering for Vat is committing vat fraud in its simplest form.

    The EU is trying to level the playing field by removing unfair marketplace price distortion by non Eu sellers in this era of global cross border ecommerce

  16. Anonymous Coward
    Anonymous Coward

    What we really need

    Is a clampdown on dishonest sellers who make up the shortfall having to pay VAT by selling a larger quantity of substandard (read, fakeflash and its ilk) goods which are in many cases a death trap or a fire waiting to happen.

    Zero hour (or in some cases less-than-zero-hour) contracts where workers are virtual slaves and only paying wages once all that months worth of goods clear Customs and buyer has left feedback should also be a concern, as are goods which contain dangerous long since banned materials such as lead as a counterweight to disguise the suspiciously low mass of the fake item "feels heavy so must be genuine, natch"...

    Ironically what should be done is to encourage honest business such as selling from a UK warehouse where the goods are made in the UK using locally sourced parts and only buying in the components that cannot be UK made cheaply in sufficient quantity at the moment.

    Thanks to 3D printing a lot of plastics are also now recyclable into new products.

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