Online stores operating outside the European Union are now subject to the new ecommerce VAT package
July 21, 2021
This new European regulation came into force on July 1, 2021 and makes VAT applicable on shipments with a value of no more than 150 euros, which eliminates the exemption that made buying small value products very affordable, for example in Chinese online stores.
Previously, if you bought products costing less than 150 euros from online stores outside the European Union, you did not have to pay VAT. This allowed online stores to compete at an advantage and make similar items sold in EU online stores much cheaper.
Under the new rules, these exemptions disappear. All products, regardless of price, will be subject to tariffs and VAT, which will undoubtedly affect ecommerce prices.
To implement this new regulation, the EU has created the IOSS system that allows to avoid the customer having to go through customs formalities.
If you register with IOSS, your customers will appreciate that the price they pay represents the final price, VAT included, with no hidden charges or fees. Otherwise your customer will pay VAT when importing goods into the EU resulting in unexpected costs and complaints for your company.
Contact the Crossborderit team to get the advice you need on the new IOSS and also be your IOSS representative.
CBIT has it covered for you. With simple onboarding and simple, flat shipping rates, it will be very easy to calculate tariffs, collect them and even pay them for you. Plus, CBIT offers simple DDP for these solutions for an excellent, hassle-free customer experience.
Register with Crossborderit and ship hassle-free.