Help with Something re: International Purchase and VAT

[BomTrady]

I am hoping someone can help me make sense of this. I've made purchases from this Naples-based manufacturer of tailored clothing for years. I am in the US and over the years, I've paid a significant amount of duties via DHL to US Customs each and every time I've made purchases through this merchant because the merchant tells Customs that VAT is excluded - as is duly noted on his webpage (below). However, I just paid attention to this contradiction - this is what's on the merchant's website:



FOR EU CUSTOMER ALL TAXES ARE INCLUDED AND FOR NON-EU CUSTOMERS: PRICE IS ALREADY EXCL. 22% VAT FREE WORLDWIDE EXPRESS SHIPPING FROM 600,00 €

Now, the only EU sales taxes I know about are VAT, but I am certainly no international tax expert. So, if the merchant is charging price X for everyone EU and US, but that same price X includes taxes for EU, but the same price X excludes VAT for non-EU - if I am interpreting this correctly - how does it make sense?

Is this merchant merely saying I charge non-EU customers more for the same product or are 'taxes" paid by EU and VAT excluded to non-EU refer to two separate kinds of taxes? If I am paying taxes in EU, I don't believe I have to pay again in the US. In fact, I should be able to get a refund of the VAT and choose to pay taxes in the US if I choose (I thought anyway). I don't plan to do anything aboiut this, but I am curious if anyone can reconcile the disclsoure.

Thanks, all.

 

[JohnMRobie]

I am hoping someone can help me make sense of this. I've made purchases from this Naples-based manufacturer of tailored clothing for years. I am in the US and over the years, I've paid a significant amount of duties via DHL to US Customs each and every time I've made purchases through this merchant because the merchant tells Customs that VAT is excluded - as is duly noted on his webpage (below). However, I just paid attention to this contradiction - this is what's on the merchant's website:



FOR EU CUSTOMER ALL TAXES ARE INCLUDED AND FOR NON-EU CUSTOMERS: PRICE IS ALREADY EXCL. 22% VAT FREE WORLDWIDE EXPRESS SHIPPING FROM 600,00 €

Now, the only EU sales taxes I know about are VAT, but I am certainly no international tax expert. So, if the merchant is charging price X for everyone EU and US, but that same price X includes taxes for EU, but the same price X excludes VAT for non-EU - if I am interpreting this correctly - how does it make sense?

Is this merchant merely saying I charge non-EU customers more for the same product or are 'taxes" paid by EU and VAT excluded to non-EU refer to two separate kinds of taxes? If I am paying taxes in EU, I don't believe I have to pay again in the US. In fact, I should be able to get a refund of the VAT and choose to pay taxes in the US if I choose (I thought anyway). I don't plan to do anything aboiut this, but I am curious if anyone can reconcile the disclsoure.

Thanks, all.

I’ve seen similar phrasing used on some merchants websites and in those cases the digital storefront they use can tell where your IP address is and automatically deducts VAT from the displayed price so if you’re based in Europe it’ll display the higher price with VAT included, if you’re based abroad it’ll display the lower price with VAT excluded.

 

[SartoriaModerna]

IP based pricing is one possibility indeed, you could ask someone from EU here on the forum to check the pricing so you can compare whether there is a difference

if you want to be sure, you can as well double check when checking out, most of the time it will mention "product price" , "tax" and "shipping" to indicate the cost buildup of total amount.

 

[BomTrady]

IP based pricing is one possibility indeed, you could ask someone from EU here on the forum to check the pricing so you can compare whether there is a difference

if you want to be sure, you can as well double check when checking out, most of the time it will mention "product price" , "tax" and "shipping" to indicate the cost buildup of total amount.

'Good idea. THanks.

 

[BomTrady]

I’ve seen similar phrasing used on some merchants websites and in those cases the digital storefront they use can tell where your IP address is and automatically deducts VAT from the displayed price so if you’re based in Europe it’ll display the higher price with VAT included, if you’re based abroad it’ll display the lower price with VAT excluded.

That's likely the answer and the price displayed isn't the same price for everyone. 'Very possible.

 

[SartoriaModerna]

to further help you out, I'm here based in EU and this is what I see for this jacket. (first jacket on sales page).

There is written the price is already excluded VAT for non-EU and tax is included for EU. I think it's indeed IP based as when I check out, it automatically detects my country and prices stays the same.

 

[zippyh]

Try using a VPN set to US. Then see what happens trying to check out with an EU delivery address.

 

[JohnMRobie]

to further help you out, I'm here based in EU and this is what I see for this jacket. (first jacket on sales page).

There is written the price is already excluded VAT for non-EU and tax is included for EU. I think it's indeed IP based as when I check out, it automatically detects my country and prices stays the same.

Interesting. It isn’t what I had thought in that case - That’s the same as what shows up for the US price. It really bugs me when brands do that and pocket the VAT. Worse yet it looks like they don’t cover duties. Crockett Jones started doing the same thing through their direct sales and I refuse to pay an extra 22% to a brand just because they feel like pocketing it.

 

[circumspice]

C&J has a shop in NYC they want to protect - all the products in the shop need to be priced to cover the duties they have to pay to import into the US. If C&J didn't charge VAT / raise prices for the US market online, they'd experience a lot of showrooming as people in the tri-state area try stuff on at the store and then buy online

 

[haloitsme]

To make a long story short.
Yes, they make more money on the items when the items are Exported (Outside the EU). However, as they offer free shipping (over €600) and free return; and the USA, HK etc. are signifacntly more expensive to ship and return from, which also involves some paperwork, I believe, that is so to offset the extra costs.