RS-Components and UK resellers after Brexit: should I worry?

[bd139]

Yeah that’s fair. Mine took me to court and forgot to turn up. Magistrate ordered they pay me costs lol. Had to appoint bailiffs to get the costs paid.

[stj]

exactly the same thing happened to a friend of mine who sued British Telecom.
you would think they could atleast send a representative to a hearing!!

[magic]

one small european country had no government for atleast 2 years afaik and functioned just fine - it may have been belgium.

They should try it without NATO and then tell us how wonderful it is.
There certainly exist legitimate uses for national governments, the problem is they have grown completely out of control.

Now, let's talk international governments
Brexit wouldn't be a thing if the EU remained a customs union.

[bd139]

Brexit wouldn't be a thing if the IQ bell curve shifted right a bit.

[Zucca]

Only a few realize that population IQ bell curve is the real, huge and underestimated problem.

The rest is just stupid cosmetic.

[grizewald]

Sadly, UK sellers on eBay will not be seeing purchases from me after Brexit.

This isn't out of spite, it's due to the policies enacted by the Swedish post company Postnord. Sweden is unique in the EU in insisting that all purchases from outside the EU are liable for VAT, even if the value of the purchase is one penny. For a long time, Postnord ignored this and did what all other EU countries do - send small value items straight on without charge.

Then, a "journalist" at one of the Swedish newspapers started kicking up a stink about the fact that people were ordering stuff from China and the government wasn't getting its VAT. The government could no longer turn a blind eye and demanded that Postnord ensure that VAT is collected on every non-EU package.

The result is that Postnord implemented a system which means that anything from outside the EU is delayed by six to twelve weeks and for this privilege, you get to pay an administration charge of 75 SEK per parcel (125 SEK if the value is over 1600 SEK).

So, even if the value of the parcel is 1 SEK, with a VAT charge of 0.25 SEK, I get to pay 75 SEK on top and have to wait an unreasonable amount of time to receive the parcel. (If it actually arrives that is. Oh, and if Postnord 'lose' your parcel, you don't get the administration charge back.)

Because of this farce, I no longer buy from non-EU sellers. It's simply not worth the wait, the charges or the risk. Once the UK becomes "non EU", that's the end of my shopping on ebay.co.uk, which is a real shame.

The only company outside the EU who I regularly deal with is Mouser. This is because they will add on the VAT and pay it for me as part of the service. This means that I can order parts from Mouser on the Monday and have them in my hand on the Wednesday thanks to their free FedEx shipping.

[bd139]

Yep. Totally. This is why I don't buy stuff from the US already and I expect us to suffer now.

I was going to buy an Elecraft K2 transceiver a while back. $1300 approx from the US which is 996 GBP. Fair enough - that's the price to play.

By the time duty, VAT, handling charges and insurance had gone into the purchase, total out of my pocket is £1630. Forget it totally!

[Bud]

@grizewald
Based on your post Sweden is now free from Chinese junk. Is that the case?

[apis]

No, it just means there is one extra middle man. There are plenty of dollar stores selling junk, and Wish.com made a deal with Postnord so they still sell a lot of imported junk by mail. (Not all of it is junk of course, although the stuff you can get still get via dollar stores are. Not all of it comes from China either).

I don't mind paying VAT at all, but the 75 SEK private tax that Postnord charges is just nuts.

[grizewald]

@grizewald
Based on your post Sweden is now free from Chinese junk. Is that the case?

Not completely. Postnord and Wish negotiated a deal where Wish add on the VAT at the time of purchase and use a Swedish payment processor for the transaction who sends the VAT directly to the government. Wish then mark the package with a code which prevents it being diverted into the "ransom your package" stream when it arrives in Sweden.

Most of the time, this works.

It may well be that Postnord put the journalist up to breaking the story and putting pressure on the Government so that they could do something about the mountains of parcels which were arriving every day from China. The volume was up to 100s of thousands of packages every week and they were losing money delivering them due to the special prices that China get under international postal agreements.
It wasn't the right way to solve the problem though, as all non-EU parcels are equally affected by long delays and out of proportion handling charges.

[SilverSolder]

The volume was up to 100s of thousands of packages every week and they were losing money delivering them due to the special prices that China get under international postal agreements. It wasn't the right way to solve the problem though, as all non-EU parcels are equally affected by long delays and out of proportion handling charges.

Can't you just find a way to blame the EU for this?  -  that has worked so well for England so far!

[magic]

Sweden is unique in the EU in insisting that all purchases from outside the EU are liable for VAT, even if the value of the purchase is one penny.

You aren't unique and as far as I know it's coming to all of EU in two years or something like that.
What might be unique is that the post bothers enforcing it. They considered similar system here last year but ultimately it still doesn't exist.

Can't you just find a way to blame the EU for this?  -  that has worked so well for England so far!

Not EU this time but international postal agreements which put the burden of delivery of incoming mail on the destination country.
It was okayish for normal mail but it completely fails with mass scale ecommerce. Basically the post has to raise prices of domestic mail to make up for the loss, giving unfair advantage to foreign sellers. Those deals should have been abolished and renegotiated, at least with the worst offender countries.

Trying to stop this trade by asinine VAT enforcement would surely be wrong.

But frankly, I think it's not about postal losses but about VAT itself. It might be pennies per package, but there are millions of those packages and it adds up. I'm pretty sure the end game is to get all EU countries to implement similar systems, effectively blocking AliExpress et al until they agree to charge their customers VAT like Mouser does.

[SilverSolder]

Sweden is unique in the EU in insisting that all purchases from outside the EU are liable for VAT, even if the value of the purchase is one penny.

You aren't unique and as far as I know it's coming to all of EU in two years or something like that.

Every EU member country is required to charge VAT for goods imported from a non-EU country (but not for EU member countries of course).   

In the US, you are often required to pay sales tax in your home state when you purchase via mail order from another state.  Then, it is called "use tax" rather than "sales tax".

The one thing we can always be sure of is that the tax man will get his cut, no matter what we do!


Re. the postal agreement -  Trump hates them too.  But they are based on the volume of mail being approximately balanced in both directions.  All we have to do is start exporting stuff to China, instead of us all only buying stuff from them!

[apis]

It's some weird sort of protectionism. There are lots of companies importing cheap stuff from China and then reselling it to the locals for 10 to 20 times the price. Example: you could buy USB-cables from AliExpress for US$2 including shipping, in the stores the same cable (made in China) cost at least $20.

It may well be that Postnord put the journalist up to breaking the story and putting pressure on the Government so that they could do something about the mountains of parcels which were arriving every day from China.

The Swedish Trade Federation (Svensk Handel) were also pushing for it.
https://www.svt.se/opinion/svensk-handel-om-e-handel-fran-kina

But frankly, I think it's not about postal losses but about VAT itself. It might be pennies per package, but there are millions of those packages and it adds up.

No, it wasn't nothing but it wasn't enough that the government really cared either. In particular it would cost much more to collect VAT than to just let it slide which is how it used to be for orders below a certain amount. This new rule was to prevent people from buying directly from China in order to favour local stores who were also importing goods from China and reselling them here. Can't compete with people who buy directly from the factories in China.

Can't you just find a way to blame the EU for this?  -  that has worked so well for England so far!

This probably only makes sense to people in Sweden:
http://y2u.be/S8SF3XmLQps

[grizewald]

It's some weird sort of protectionism. There are lots of companies importing cheap stuff from China and then reselling it to the locals for 10 to 20 times the price. Example: you could buy USB-cables from AliExpress for US$2 including shipping, in the stores the same cable (made in China) cost at least $20.

You hit the nail on the head.

Like you, I have no problem paying VAT if the government insists. What I can't live with is the completely unjustified delays and the fantasy costs.

Even ordering from within the EU exposes how crap Postnord's service is these days. A package which arrives in Sweden on a Monday from the UK, having been posted in the UK on the Friday, will finally get delivered to my local post agent on the Friday most times. In the days before the utterly misguided fusion with Post Denmark to create Postnord, it normally took 72 hours, door to door, for parcels from the UK.

For some things, RC parts in particular, there is often no alternative than to order from China as finding the parts I want in Sweden is not possible. If companies like Kell & Co dialled back the greed a bit, I would buy more from them. As it is today, I can buy five nodeMCU boards from China for less than Kjell & Co want for one! The same applies, as you rightly point out, with USB cables. Even most Swedish web shops aren't much better, due to the cost of doing business here in Sweden being so ridiculously high.

Several times, I've looked at going into business on my own here, but when you have to charge 500 SEK to get 100 SEK in your hand, most ideas just don't add up. Not to mention being buried under a mountain of unnecessary administration which means you end up working half of your working week on things that don't generate income.

Still, it beats moving back to the UK any day! 

[magic]

Every EU member country is required to charge VAT for goods imported from a non-EU country (but not for EU member countries of course).

Nope, to the best of my knowledge, small packages are exempt and only a few countries insist that you owe them tax even on $1 items. But this is supposedly going to change in a few years so that all of EU will be like you say.

Re. the postal agreement -  Trump hates them too.  But they are based on the volume of mail being approximately balanced in both directions.  All we have to do is start exporting stuff to China, instead of us all only buying stuff from them!

There is nothing America or Europe could export to china in postal envelopes that they couldn't produce cheaper domestically. You can't compete on cheap, tiny stuff with a billion of third-world people. Those agreements should simply be changed, they make no sense anymore with China.

No, it wasn't nothing but it wasn't enough that the government really cared either. In particular it would cost much more to collect VAT than to just let it slide which is how it used to be for orders below a certain amount. This new rule was to prevent people from buying directly from China in order to favour local stores who were also importing goods from China and reselling them here.

Protectionism is a factor too, but you didn't get my point at all.

Collecting tax from a million of tiny packages is expensive and hence they used to let it slide. But receiving a bulk wire transfer from Mouser or AliExpress is cheap. And that's what they are after, I think. There is a certain volume of cheap stuff imported from China, probably quite significant and probably rising from year to year, and if they simply allow direct orders to bypass customs, they will lose tax revenue from that import as more people will transition to ordering directly from China.

So they send a massive fuck-you to Chinese retailers and hope that they will compromise and start to charge VAT on their behalf. I can't be sure, but I think this is what's going to happen. Chinese probably know it too and they are just milking the current opportunity for all they can. But in a few years all of EU will enforce insane processing fees on incoming mail and the only way to buy cheaply from China will be from vendors who have deals to collect VAT at the time of sale and bypass customs.

[tooki]

Digikey is actually "funny" here in France - they pretend to have a French website, it shows as the contact their Dutch office (with a Dutch phone number & French fax number - go figure). But when you order from them, everything comes from the US (Digikey doesn't have any EU stock, AFAIK) and while you usually don't pay any customs charges, UPS will send you an invoice for about 20 euro for doing the customs declaration - for every order. Even though filling the customs declaration is the sender's responsiblity and not yours (Digikey apparently couldn't be bothered/doesn't pay for it - so UPS will charge the recipient for it instead!).

However, when you raise a stink, since wtf are these charges about when they weren't mentioned on the original site, they make all the effort to look like an EU company, they have an EU VAT registration and actually do collect the VAT here, they invoice you from Netherlands as well, so as a buyer you have the every right to expect it is a "local" (within EU) transaction (thus you shouldn't have to pay any customs  declaration fees) - they will waive the fee! But good luck trying this unless you are a company with a VAT number, they will just tell you to piss off.

I find this a very disgusting business practice.

What's really bizarre is how Digi-Key has different export terms for each country it ships to, seemingly. And it varies by the currency you pay in, too!


For example, here are their export terms for France:

For France, you may select one of the following currencies:

Euro
Free delivery to France on orders of 50,00 € or more.
A delivery charge of 18,00 € will be billed on all orders less than 50,00 €.

Incoterms:
Business-to-Business shipments with a validated VAT number: DDP (Duty and customs paid by Digi-Key)
All other shipments: CPT (Duty, customs, and VAT due at time of delivery)

US Dollar
Free delivery to France on orders of $60,00 USD or more.
A delivery charge of $22,00 USD will be billed on all orders less than $60,00 USD.

Incoterms:
UPS freight pre-paid: DDP (Duty and customs paid by Digi-Key)
FedEx or DHL freight pre-paid: CPT (Duty, customs, and VAT due at time of delivery)

So you'd want to buy in USD and have UPS freight. (Can they even do that for small orders?)




In contrast, here are the terms for Germany (which I would have expected to be identical, given that they're both EU, but they're not!)

For Germany, you may select one of the following currencies:

Euro
Free delivery to Germany on orders of 50,00 € or more.
A delivery charge of 18,00 € will be billed on all orders less than 50,00 €.

Incoterms:
DDP (Duty and customs paid by Digi-Key)

US Dollar
Free delivery to Germany on orders of $60,00 USD or more.
A delivery charge of $22,00 USD will be billed on all orders less than $60,00 USD.

Incoterms:
UPS freight pre-paid: DDP (Duty and customs paid by Digi-Key)

FedEx or DHL freight pre-paid: CPT (Duty, customs, and VAT due at time of delivery)

So you'd definitely want to order in Euros.




And this is the terms for Switzerland:

For Switzerland, you may select one of the following currencies:

Franc
Free delivery to Switzerland on orders of 54.00 CHF or more.
A delivery charge of 20.00 CHF will be billed on all orders less than 54.00 CHF.
Incoterms:
DDP (Duty and customs paid by Digi-Key)

Euro
Free delivery to Switzerland on orders of 50,00 € or more.
A delivery charge of 18,00 € will be billed on all orders less than 50,00 €.
Incoterms:
DDP (Duty and customs paid by Digi-Key)

US Dollar
Free delivery to Switzerland on orders of $60,00 USD or more.
A delivery charge of $22,00 USD will be billed on all orders less than $60,00 USD.
Incoterms:
UPS, FedEx or DHL freight pre-paid: DDP (Duty and customs paid by Digi-Key)

Here, any currency is equal. (For once, living in Switzerland has an advantage for ordering online!) What's not obvious is that UPS or FedEx will still collect Swiss VAT on delivery. (But they don't seem to charge a fee for this.)


Ultimately, any vendor can choose how easy they want to make it for their customers, by providing full-service customs pre-clearance with VAT collection (like AmazonGlobal*), to partial (like Digikey with DDP incoterms), to nothing at all (like Mouser and Farnell).


*Insert rant about Amazon stopping delivery to Switzerland from all Amazon domains except .de, .fr, .it, .es and .co.uk. This really sucks because there are tons of things on Amazon.com and .co.jp that aren't available on the local ones -- and even on the local ones, a HUGE percentage of items do not ship to Switzerland. (Even AmazonBasics stuff is weird: single Lightning cable? No problem. 12-pack? Verboten!) This is because of Switzerland's dumb new VAT law, which somehow Amazon has refused to implement across all its domains, despite it being a simpler VAT algorithm than the old one, which AmazonGlobal supported... Oh, and 2018 came and went without amazon.ch launching as expected.

[SilverSolder]

Every EU member country is required to charge VAT for goods imported from a non-EU country (but not for EU member countries of course).

Nope, to the best of my knowledge, small packages are exempt and only a few countries insist that you owe them tax even on $1 items. But this is supposedly going to change in a few years so that all of EU will be like you say.

We are both right:   Every country is required to collect VAT on imports, but are allowed to use a "Low Value Consignment Stock Relief" threshold (which is generally EUR 22) to reduce administration and costs for low value goods.   Some countries have gone the other way (Norway is a bit higher than that, for example).

I didn't realize that Sweden had set its threshold to zero - seems counterproductive, but in keeping with the national penchant of taxing anything that moves (and many things that don't?).

[SilverSolder]

But in a few years all of EU will enforce insane processing fees on incoming mail and the only way to buy cheaply from China will be from vendors who have deals to collect VAT at the time of sale and bypass customs.

That does sound very plausible.

So you either import and resell large enough quantities that the numbers make sense,  or you buy from a foreign vendor that has a VAT agreement in place to simplify processing.

It could make a ton of sense for someone like PayPal to get those kinds of things in place, as a service, to allow smaller vendors to sell economically to EU countries.

[MT]

one small european country had no government for atleast 2 years afaik and functioned just fine - it may have been belgium. i remember because the EU communist head office imposed one on them so they could take directives(orders) from brussels only local government actually does anything usefull - like fixing roads and collecting rubbish - national governments are parasites.

Sweden was out of a gov for 131 days and it worked just as with a gov to every Swedish citizens surprise! Italy may some argue is constantly out of proper gov and is still around.

Dutch 208 days in 2017. Germany 171 days in 2017. Norway 123 days in 2018. Belgum 541 days in 2010.

So gov is overrated, just a kindergarten for self proclaimed elites.

[Towger]

People are forgetting that countries have two forms of government.  Politicians who temporary and Civil servants who are permanent.  Most countries will quite happily keep running for along period without politicians.

[apis]

Protectionism is a factor too, but you didn't get my point at all.

Collecting tax from a million of tiny packages is expensive and hence they used to let it slide. But receiving a bulk wire transfer from Mouser or AliExpress is cheap. And that's what they are after, I think. There is a certain volume of cheap stuff imported from China, probably quite significant and probably rising from year to year, and if they simply allow direct orders to bypass customs, they will lose tax revenue from that import as more people will transition to ordering directly from China.

So they send a massive fuck-you to Chinese retailers and hope that they will compromise and start to charge VAT on their behalf. I can't be sure, but I think this is what's going to happen. Chinese probably know it too and they are just milking the current opportunity for all they can. But in a few years all of EU will enforce insane processing fees on incoming mail and the only way to buy cheaply from China will be from vendors who have deals to collect VAT at the time of sale and bypass customs.

One might think the government makes a lot of money from this, but the government got less than $0.4 million the first month after implementing the new rule (could't find newer figures), while Postnord made more than 5 times that amount from their "administration fee". Every package from outside EU is delayed and charged more than $8 extra by Postnord which they put in their own pockets.

The reason for the law probably wasn't that the gov believed they would get a lot of tax money but rather that the Swedish Trade Federation were moaning about it being unfair competition from the Chinese since they didn't have to pay VAT. And to be fair, they were right about that. The Chinese doesn't care about meeting our safety regulations or other regulations either which is also a problem. But the way this was implemented was as way to eliminate the completion from private direct import completely.

If you can even find the same goods locally (usually not), it originates from China whether we buy it from a local trader or directly from China. By buying from AliExpress we eliminate not only vat and safety regulations, but more importantly we eliminate the middlemen who add more than 1000% to the price which they put in their own pockets. The middlemen don't really add any value for anyone so it's a good thing if we can eliminate that link in the chain. It would be different if the Chinese were competing with locally made goods but they are not.

You guessed correctly regarding wanting AliExpress, etc, to charge VAT and transfer it to the gov directly. But Postnord still wants to administer that so that they can continue to charge an "administration fee" but directly from AliExpress in that case. The problem with that plan is that no one cares about a country with a population of only 10 million, we're too small to matter. If they implemented this on the EU-level it would be different. If they could convince AliExpress to charge VAT and enforce safety regulations I might even support it. As it is now they just make it impossible for normal people to buy low value items from outside of the EU.

[apis]

People are forgetting that countries have two forms of government.  Politicians who temporary and Civil servants who are permanent.  Most countries will quite happily keep running for along period without politicians.

The legislative branch and the executive branch of the state. You won't keep going without the legislative branch forever though, even if you wanted that, and I don't see why anyone would want that to be honest.

The executive branch is just as rotten as the legislative because it is also made of people, and people are imperfect. It's just that you usually don't get as much news about them so people don't realise. And of course, they are not permanent, they are usually appointed by the legislative branch.

Out of sight, out of mind.

[Tepe]

I don't mind paying VAT at all, but the 75 SEK private tax that Postnord charges is just nuts.

Oh, you are lucky. They charge 160 DKK on the other side of the Sound.

[legacy]

I wish even Italy took the brexit step