A.k.a. Metal Madness Vapors - makers of the Poldiac, et al.
This is ridiculous. I was all set to order a Poldiac and quite a few other things, so it would have been a fairly substantial order. However, it turns out that a friend just bought a Poldiac and was charged VAT (Value Added Tax). That was wrong. VAT is charged on merchandise sold between EU countries, not on exports to the US. He has sent them emails trying to get a refund and gotten no response.
Instead of placing an order, I sent them a message:
Hello
I would like to place an order, but I'm confused about the Value Added Tax. I am in the USA and it is my understanding I will not be subject to VAT if I order from your company. I would like to be clear on this before placing an order.
Thank you.
This is what I got back from MiriamWTH, MMVapors Support Team:
We can send it without VAT but you will have to pay customs & taxes. You will probably pay much more.
You have two options according to the Greek law, either we both pay for vat or we must do a commercial export, in that case you will have to pay the amount that your customs will decide and this is usually a lot higher.
I hope this helps.
Well, no it doesn't. MMVapors are required to affix a customs declaration to their packages that lists: the seller, the buyer, a description of the item, it's weight, how much the buyer paid for it and if it's merchandise, a gift, commercial or a sample (there may be additional options). In any case, there is a clear distinction between merchandise purchased for personal use and for commercial use. And even if a US customer paid VAT it wouldn't stop the US from charging an import duty if appropriate, since the two aren't related. Also, imported merchandise under $200.00USD is generally exempt.
I polled my friends who have bought from other Greek companies, like ByLeo and Gr-Modders, and none of them have been charged VAT. I then posted a question on a Poldiac fan thread on another forum, asking about VAT. It was essentially the email correspondence posted above.
Within minutes, guess who shows up on the thread? MiriamWTH! Interestingly, she lists her location as Tilburg (Netherlands). No wonder she has such stunning knowledge of Greek law.
MiriamWTH:
The Greek law states that the only way that no VAT has to be paid is when a commercial export is done.
The costs for a commercial export are higher plus customs will treat a commercial export differently than a normal package adding costs that are generally higher than the amount of VAT paid on goods with a total of less than 500 euro.
My friend who got ripped-off jumped in:
Yet other Greek suppliers are not charging VAT to non-EU customers. The commercial export exclusion only applies to shipments destined for other EU-member countries where VAT is applicable. VAT shouldn't apply to non-EU members regardless.
MiriamWTH:
I do not know how other Greek suppliers do it, all I know is that MMVapors is doing everything according to Greek law.
And you are welcome to have your order shipped as a commercial export so you do not pay for VAT. But as stated before the end-cost will be a lot higher.
My friend:
You can't make an exemption to a non-applicable circumstance, therefore the commercial export exemption would not apply to non-EU destinations. Apparently the other suppliers are just aware of this fact & aren't overcharging American customers. Also as a non-EU customer, I'm allowed to reclaim any VAT that I've been charged. Typically that would only happen with purchases made on EU soil since online purchases with non-EU destinations aren't supposed to have the VAT added to them in the first place, only customs duties. As Ocelot said, items valued at under $200 do not apply. With whom at MMV should I speak with about reclaiming these wrongly charged taxes?
PS I tried to solve this problem via email, but since my messages are being ignored I have no other choice but to pursue this on a public forum.
Me:
The "commercial" designation you describe sounds like something that is being purchased for resale, at least that is how US Customs interprets the term. What I would be purchasing is merchandise for personal use.
General overview - European commission
"VAT on imports and exports:
For the purpose of exports between the Community and non-member countries, no VAT is charged on the transaction and the VAT already paid on the inputs of the good for export is deducted - this is an exemption with the right to deduct the input VAT, sometimes called 'zero-rating'. There is thus no residual VAT contained in the export price." (Quoted from the site above)
I got the following information about international online purchases directly from the US Customs site.
Internet Purchases | U.S. Customs and Border Protection
"Note: It is important to know that foreign shipments that are not accompanied by a U.S. Customs and Border Protection declaration form and an invoice may be subject to seizure, forfeiture or return to sender."
"Hint: To speed a package through CBP examination at a port's International Mail Branch, the seller should affix a completed CN 22 or CN 23 (U.S. Customs and Border Protection Declaration Form) to the outside of the package. This form may be obtained at local post offices worldwide."
Me again:
Here's another one: EUROPA - Cross-border VAT: buying & selling inside and out of the EU - Your Europe
"Special rules apply if you buy or sell goods/services from or to other countries."
"If you sell goods to customers outside the EU, you do not charge VAT, though you may still deduct the VAT you yourself have paid on your related expenses (goods/services bought in specifically to make those sales)."
Greek law has been brought up in this discussion, but in this case it's my understanding the policies regarding VAT are under the rules of the EU, not the individual countries themselves.
When preparing the export documentation what kind of transaction does MMVapors list when it's a "regular" rather than "commercial" purchase?
MirianWTH:
I think the catch is right there regarding the Greek law: "If you sell goods to customers outside the EU, you do not charge VAT, though you may still deduct the VAT you yourself have paid on your related expenses (goods/services bought in specifically to make those sales)."
In order for a Greek company to still deduct the VAT they have to do a (what translates to) "commercial export" in order to prove to the Greek government that the goods are indeed leaving the EU in order to deduct the VAT. This special export brings more costs for orders up to 500 euro. Since this special export comes with a lot more paperwork, there is a delay in customs in the US and customs in the US will then also charge the end consumer for these extra costs they make.
In order to avoid extra costs for the customer MMV decided to go the first route described and that is to just add the VAT.
In response to my friend's last post Miriam replied:
Your messages have been answered by me personally.... I am sorry you did not like the answer in them, but they have been answered.
This is complete and utter BS. Value Added Tax is assessed by the EU. EU trumps Greece.
(continued to next post)
This is ridiculous. I was all set to order a Poldiac and quite a few other things, so it would have been a fairly substantial order. However, it turns out that a friend just bought a Poldiac and was charged VAT (Value Added Tax). That was wrong. VAT is charged on merchandise sold between EU countries, not on exports to the US. He has sent them emails trying to get a refund and gotten no response.
Instead of placing an order, I sent them a message:
Hello
I would like to place an order, but I'm confused about the Value Added Tax. I am in the USA and it is my understanding I will not be subject to VAT if I order from your company. I would like to be clear on this before placing an order.
Thank you.
This is what I got back from MiriamWTH, MMVapors Support Team:
We can send it without VAT but you will have to pay customs & taxes. You will probably pay much more.
You have two options according to the Greek law, either we both pay for vat or we must do a commercial export, in that case you will have to pay the amount that your customs will decide and this is usually a lot higher.
I hope this helps.
Well, no it doesn't. MMVapors are required to affix a customs declaration to their packages that lists: the seller, the buyer, a description of the item, it's weight, how much the buyer paid for it and if it's merchandise, a gift, commercial or a sample (there may be additional options). In any case, there is a clear distinction between merchandise purchased for personal use and for commercial use. And even if a US customer paid VAT it wouldn't stop the US from charging an import duty if appropriate, since the two aren't related. Also, imported merchandise under $200.00USD is generally exempt.
I polled my friends who have bought from other Greek companies, like ByLeo and Gr-Modders, and none of them have been charged VAT. I then posted a question on a Poldiac fan thread on another forum, asking about VAT. It was essentially the email correspondence posted above.
Within minutes, guess who shows up on the thread? MiriamWTH! Interestingly, she lists her location as Tilburg (Netherlands). No wonder she has such stunning knowledge of Greek law.
MiriamWTH:
The Greek law states that the only way that no VAT has to be paid is when a commercial export is done.
The costs for a commercial export are higher plus customs will treat a commercial export differently than a normal package adding costs that are generally higher than the amount of VAT paid on goods with a total of less than 500 euro.
My friend who got ripped-off jumped in:
Yet other Greek suppliers are not charging VAT to non-EU customers. The commercial export exclusion only applies to shipments destined for other EU-member countries where VAT is applicable. VAT shouldn't apply to non-EU members regardless.
MiriamWTH:
I do not know how other Greek suppliers do it, all I know is that MMVapors is doing everything according to Greek law.
And you are welcome to have your order shipped as a commercial export so you do not pay for VAT. But as stated before the end-cost will be a lot higher.
My friend:
You can't make an exemption to a non-applicable circumstance, therefore the commercial export exemption would not apply to non-EU destinations. Apparently the other suppliers are just aware of this fact & aren't overcharging American customers. Also as a non-EU customer, I'm allowed to reclaim any VAT that I've been charged. Typically that would only happen with purchases made on EU soil since online purchases with non-EU destinations aren't supposed to have the VAT added to them in the first place, only customs duties. As Ocelot said, items valued at under $200 do not apply. With whom at MMV should I speak with about reclaiming these wrongly charged taxes?
PS I tried to solve this problem via email, but since my messages are being ignored I have no other choice but to pursue this on a public forum.
Me:
The "commercial" designation you describe sounds like something that is being purchased for resale, at least that is how US Customs interprets the term. What I would be purchasing is merchandise for personal use.
General overview - European commission
"VAT on imports and exports:
For the purpose of exports between the Community and non-member countries, no VAT is charged on the transaction and the VAT already paid on the inputs of the good for export is deducted - this is an exemption with the right to deduct the input VAT, sometimes called 'zero-rating'. There is thus no residual VAT contained in the export price." (Quoted from the site above)
I got the following information about international online purchases directly from the US Customs site.
Internet Purchases | U.S. Customs and Border Protection
"Note: It is important to know that foreign shipments that are not accompanied by a U.S. Customs and Border Protection declaration form and an invoice may be subject to seizure, forfeiture or return to sender."
"Hint: To speed a package through CBP examination at a port's International Mail Branch, the seller should affix a completed CN 22 or CN 23 (U.S. Customs and Border Protection Declaration Form) to the outside of the package. This form may be obtained at local post offices worldwide."
Me again:
Here's another one: EUROPA - Cross-border VAT: buying & selling inside and out of the EU - Your Europe
"Special rules apply if you buy or sell goods/services from or to other countries."
"If you sell goods to customers outside the EU, you do not charge VAT, though you may still deduct the VAT you yourself have paid on your related expenses (goods/services bought in specifically to make those sales)."
Greek law has been brought up in this discussion, but in this case it's my understanding the policies regarding VAT are under the rules of the EU, not the individual countries themselves.
When preparing the export documentation what kind of transaction does MMVapors list when it's a "regular" rather than "commercial" purchase?
MirianWTH:
I think the catch is right there regarding the Greek law: "If you sell goods to customers outside the EU, you do not charge VAT, though you may still deduct the VAT you yourself have paid on your related expenses (goods/services bought in specifically to make those sales)."
In order for a Greek company to still deduct the VAT they have to do a (what translates to) "commercial export" in order to prove to the Greek government that the goods are indeed leaving the EU in order to deduct the VAT. This special export brings more costs for orders up to 500 euro. Since this special export comes with a lot more paperwork, there is a delay in customs in the US and customs in the US will then also charge the end consumer for these extra costs they make.
In order to avoid extra costs for the customer MMV decided to go the first route described and that is to just add the VAT.
In response to my friend's last post Miriam replied:
Your messages have been answered by me personally.... I am sorry you did not like the answer in them, but they have been answered.
This is complete and utter BS. Value Added Tax is assessed by the EU. EU trumps Greece.
(continued to next post)
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