Keysight Scope Giveaway

[rch]

I still don't understand it...

Keysight has an official sales office in Germany, somewhere near Stuttgart. They have official Distributors in Germany, for example DataTec. So why on earth should a German winner have to pay a single cent to receive his prize? Winning a prize in a lottery is tax free here. There are no customs duties to be paid if the prize is delivered from a German distributor to a German citizen. And there is no VAT to be paid. All prices on goods, targeted at private individuals, have to be given including the VAT. The winners scope is free, it has no price. So 19% VAT from zero (the price the winner has to pay for the scope) ist zero, niente, null. Keysight simply can't charge VAT from the winner (private individual) for a free scope. At least that's my understanding 

You are right.  If Keysight give you a scope that is already legally in the EU, you owe the taxman, at least in the UK, nothing.   It is Keysight or perhaps their distributor who has to account for VAT. Keysight may be much more used to dealing with an EU business than a consumer, as the latter would probably buy from a distributor.   If you are a business, you would know what to do with an invoice marked with zero charge for a business gift plus a VAT charge at fair value[1], although such a taxed gift would be a remarkably odd.

If you are consumer, such an invoice would be a mystery.  And in many EU countries it would be unlawful to give a consumer such a VAT invoice.  Consumers are supposed to be charged the whole price, including VAT.   So if Keysight thought it was fair to give a gift but also charge the recipient the VAT they would really have to offer the scope at about a sixth of its price rather than as a gift, and take the VAT out of that.[2]


[1]  Keysight do not have to pay VAT on the full list price if they don't want to.  The usual selling price would be a better estimate of true value, and result in somewhat less VAT!

[2]  The alternative is to 'give' the scope to the recipient at the US factory gate and leave the recipient to pay the import charges.  But then they wouldn't be able to involve a distributor.

[TheAmmoniacal]

I have to ask..

Do you have a need for an oscilloscope?

Yes, within 3 months.
Yes, within 12 months.
No, not within the next year.

How does this work? 

[rx8pilot]

Meaningless forecasting data so marketing can make charts at the monthly meetings.

[TheAmmoniacal]

An attempt to determine what type of audience they are reaching with the Scope Month contest?

[nihtila]

Or maybe their sales will contact you if you put that you need a scope.

Interesting to read these tax discussions, but eventually I can only wait Keysight's response. I didn't hear anything new today. Yesterday they said they will contact me again in few days.

[Keysight DanielBogdanoff]

I have to ask..

Do you have a need for an oscilloscope?

Yes, within 3 months.
Yes, within 12 months.
No, not within the next year.

How does this work? 

If you're in the market for a scope, we'll contact you about it (probably an e-mail?).  It has no bearing whatsoever on your chances of winning.

[Brumby]

... which is what I would expect.

Since Keysight have already got your interest and you've supplied them with an email address (to notify you if you've won) it's a VERY easy step to ask you to click on a button, so they have an idea on whether (and when) it might be worth contacting you again, so that they can present their products for your consideration.

Marketing requires a few things to work: Knowledge of the products (Keysight make scopes), interest in the products (Keysight make good scopes), desire for the product (I need/want a new scope) and to be there when a purchase decision is being made.

The giveaway attracts the right sort of audience for these reasons - which is why it's done.  They don't need to cull participants.  In fact, the more participants, the more likely a cash-wielding purchaser will not end up with a free one.

[nihtila]

I wonder what is the ratio of hobbyists to professionals among the participants. Hobbyists are not particularly Keysight's target audience. And I don't think employees of bigger companies bother attending on behalf of their companies but small businesses probably do. And then again, many of us more serious hobbyists are also professionals even if we attend the sweepstake as individuals. And all this is good marketing for a good target audience. I still have to say that the amount of prizes is impressive.

[WattSekunde]

The relatively young name Keysight now has a much better imprinting in the market. Worldwide marketing in the form of advertisements, etc. quickly costs an comparable amount of money. I thank Keysight to give a fraction of the advertising budget to customers. 

[Brumby]

This would have to be at the top of the list of reasons...

The relatively young name Keysight now has a much better imprinting in the market.

[continuo]

I wonder what is the ratio of hobbyists to professionals among the participants. Hobbyists are not particularly Keysight's target audience.

Well, they actively advertise it here on Dave's eevblog forum and encourage members to participate on their lottery (that's how I found out about it, I wouldn't have known otherwise...). So they sure do know that a lot of hobbyists and young students will sign up because they are a huge part of Dave's audience. A poor student may not be Keysights prime target today but may be in the future... 

[nihtila]

I wonder what is the ratio of hobbyists to professionals among the participants. Hobbyists are not particularly Keysight's target audience.

Well, they actively advertise it here on Dave's eevblog forum and encourage members to participate on their lottery (that's how I found out about it, I wouldn't have known otherwise...). So they sure do know that a lot of hobbyists and young students will sign up because they are a huge part of Dave's audience. A poor student may not be Keysights prime target today but may be in the future... 

Yes, sure students are always a good target audience.

Btw, the newest info is that there would not be taxes to be paid in the UK.

[rch]

Btw, the newest info is that there would not be taxes to be paid in the UK.

That's great news!  Enjoy your prize.

The only downside is that there is now nothing to console myself with when I don't win.

[Macbeth]

Btw, the newest info is that there would not be taxes to be paid in the UK.

That's great news!  Enjoy your prize.

The only downside is that there is now nothing to console myself with when I don't win.

Great news for UK winners! I wonder if whatever wangle Keysight used can be used for when I win Dave's "used" dumpster find?

(Who am I kidding? I never win anything. I even had to stop betting on the Grand National when every time I picked a horse it would fall at Bechers and have to be shot )

[raupi]

Btw, the newest info is that there would not be taxes to be paid in the UK.

Hmmm... Are you really sure? Here's another winner of a MSOX3104T, i'm from Germany and they wrote me today that they will send the scope from Malaysia and I would have to pay the German VAT (19%) for it.

I'm not really sure what the declared value is, somewhere in the range of $15.000? That would set me back ~2.8K€ for this scope. Im still uncertain what to do now, have to think about it.

So the real question is, what's the difference between the UK and Germany? Last time I checked they were still both members of the EU...   

[Macbeth]

So the real question is, what's the difference between the UK and Germany? Last time I checked they were still both members of the EU...

By all accounts the German customs are all spawned from a dastardly genetic experiment by Dr Mengele to create a master race of Schutzstaffel tax inspectors. 

Even Dave has had to rule out Germany from his sales and competition.

But yes, whatever method works for the UK should be okay for you too I would think?

[nihtila]

Btw, the newest info is that there would not be taxes to be paid in the UK.

Hmmm... Are you really sure? Here's another winner of a MSOX3104T, i'm from Germany and they wrote me today that they will send the scope from Malaysia and I would have to pay the German VAT (19%) for it.

I'm not really sure what the declared value is, somewhere in the range of $15.000? That would set me back ~2.8K€ for this scope. Im still uncertain what to do now, have to think about it.

So the real question is, what's the difference between the UK and Germany? Last time I checked they were still both members of the EU...

Well, the answer is changing so no, I am not sure.

Did they offer you the possibility to take a cheaper model? The price jumps significantly after 200MHz. And yes, another question is what value they would use. Actual selling price is probably 20-25% lower than the list price so it kinda sucks if you need to pay taxes for the list price.

And maybe that was one of the key points of Mr Camerons summit in Brussels - do not tax Keysight giveaways!

[raupi]

Did they offer you the possibility to take a cheaper model? The price jumps significantly after 200MHz. And yes, another question is what value they would use. Actual selling price is probably 20-25% lower than the list price so it kinda sucks if you need to pay taxes for the list price.

Yes, they give me the opportunity to choose a lesser scope from their 3000 X series line. A DSOX3024T (4 channel, 200MHz) would be perfectly fine for me as well but though it is less than 30% the list price of the original win I think they would be charging VAT on it as well, regardeless.

[rch]

Did they offer you the possibility to take a cheaper model? The price jumps significantly after 200MHz. And yes, another question is what value they would use. Actual selling price is probably 20-25% lower than the list price so it kinda sucks if you need to pay taxes for the list price.

Yes, they give me the opportunity to choose a lesser scope from their 3000 X series line. A DSOX3024T (4 channel, 200MHz) would be perfectly fine for me as well but though it is less than 30% the list price of the original win I think they would be charging VAT on it as well, regardeless.

I'd like to give Keysight some free advice, which I think is fairly disinterested because I am pretty unlikely to win!   In Europe at least,[1] where the culture is that you don't pay taxes on gifts, and that VAT is a matter for the seller not the buyer in consumer transactions, they would do well to stump up the moderate five figure sum required to pay all taxes and import duties on their prizes themselves.   And announce that they are doing so as soon as possible.

Otherwise they risk their generous promotion being chiefly remembered for the trouble and disappointment it caused the winners, which can't be a good thing for them!


[1]  I can't speak for other jurisdictions.  Maybe even in the US they could hand out a bit of cash with the prize to cushion the taxes, even though that sum itself would presumably be taxed. Presumably even in the US they are absorbing import duties paid internally on their stock.  But maybe expectations are simply different  there and the same deep disappointment will not be felt with the present arrangements.  I know what us Europeans think, though!

[rx8pilot]

If I were Keysight, I would not want to deal with someone that complains about a 80%+ discount on a piece of test gear. This contest can weed out the expensive 'customers'

[hendorog]

Not sure if this has been mentioned in the thread already but this is the way I understand it. (ignoring the US)

If Keysight were to import the scope to a local distributor, then they would only pay sales tax on the wholesale price of the scope.
The distributor collects tax on the subsequent retail price and then pays the difference to the taxman.
For a prize, there is no retail price, and so there is no sales tax to collect on the retail sale. Therefore the distributor has to pay tax on the wholesale price.

If they instead send it direct to a customer (i.e. from Malaysia) then the customer pays sales tax on the fair market value as it crosses the border.
For a prize there is no discount as the tax is based on the fair market value of the device and that hasn't changed.

The key point being that less sales tax would be paid if the scope came from a local distributor. The problem is that the local distributor would pay that lower amount of tax, not Keysight.

[Towger]

They have their own offices in several European countries. No need to involve distributors.   Once in any EU country it does not matter which country it is then sent on to. Even tbe German Customs Gestato will not look for money or shred it for not having a CE mark in the correct font.

[raupi]

According to Keysight, they will send the scope from Malaysia to your local Distributor. The Distributor then sends it to you. And you will be charged with the VAT.

[hendorog]

They have their own offices in several European countries. No need to involve distributors.   Once in any EU country it does not matter which country it is then sent on to. Even tbe German Customs Gestato will not look for money or shred it for not having a CE mark in the correct font.

Indeed - in which case the sales tax payable by Keysight should be even lower, as it would be based on cost of goods, not wholesale would it not?

According to Keysight, they will send the scope from Malaysia to your local Distributor. The Distributor then sends it to you. And you will be charged with the VAT.

The key question being VAT on which value?  RRP, VAT on fair market value, VAT on cost, VAT on wholesale?
Based on what has been written (which may well be wrong), Keysight or the distributor is not paying VAT on MSRP. So if you are reimbursing Keysight then they are making a profit on the tax.

[raupi]

The key question being VAT on which value?  RRP, VAT on fair market value, VAT on cost, VAT on wholesale?

Yes indeed, this is the question. I asked them to give me an approximate figure on how much I would have to pay if I accept the prize. This is something one would expect to be not to difficult to be answered by an international operating corporation, used to do worldwide business. Got no response on that.