Hi,
Non EU businesses who sell digital goods to EU customers should also collect the VAT from the EU countries where the consumer is located (same logic as for EU businesses selling to individuals in EU). Reference is below.
Telecommunications, broadcasting & electronic services - European Commission
Consequently, a web hosting provider in the USA should collect spanish EU VAT if the customer is located in Spain. Right now, The US webhosting company Hostgator does it.
European Union Value Added Tax (VAT) « HostGator.com Support Portal
But what if the non EU business don't do it???? European Union can't do anything about it, isn't it? They can't block those people... The non EU business aren't in a EU jurisdiction
Let's discuss the consequences:
If a non EU online business sell digital goods to EU customers and if they follow the MOSS scheme, the said NON eu businesses will have to increase their prices and add the EU VAT taxes on top of their regular price. They don't have any benefits for doing it. In fact, they can "kill" the EU competitors by not complying. They aren't liable to the EU jurisdiction, so they may not care.
On the other hand, EU companies have to add the EU vat taxes on top of their prices. Consequently, for EU customers, EU providers of digital goods may become more expensive than foreigners due to VAT taxes on top of their prices.
That's a big difference between incorporating in Cyprus (and be forced to follow the MOSS) and Hong Kong (non EU).
Am i right or do i miss something?
Non EU businesses who sell digital goods to EU customers should also collect the VAT from the EU countries where the consumer is located (same logic as for EU businesses selling to individuals in EU). Reference is below.
Telecommunications, broadcasting & electronic services - European Commission
Consequently, a web hosting provider in the USA should collect spanish EU VAT if the customer is located in Spain. Right now, The US webhosting company Hostgator does it.
European Union Value Added Tax (VAT) « HostGator.com Support Portal
But what if the non EU business don't do it???? European Union can't do anything about it, isn't it? They can't block those people... The non EU business aren't in a EU jurisdiction
Let's discuss the consequences:
If a non EU online business sell digital goods to EU customers and if they follow the MOSS scheme, the said NON eu businesses will have to increase their prices and add the EU VAT taxes on top of their regular price. They don't have any benefits for doing it. In fact, they can "kill" the EU competitors by not complying. They aren't liable to the EU jurisdiction, so they may not care.
On the other hand, EU companies have to add the EU vat taxes on top of their prices. Consequently, for EU customers, EU providers of digital goods may become more expensive than foreigners due to VAT taxes on top of their prices.
That's a big difference between incorporating in Cyprus (and be forced to follow the MOSS) and Hong Kong (non EU).
Am i right or do i miss something?