The EU VAT has caused more problems for eCommerce developers and store owners than any other law in history.
— Pippinsplugins (@pippinsplugins) July 23, 2015
In so far as stupid laws go, EU VAT takes the cake. I lurked in the back of Heather Burns’ talk about it at WCEU last month and while I didn’t learn much ‘new’, it did reenforce to me exactly how daft it was.
One of the things Heather brings us is a June 16 European Parliamentary decision that was to determine if we could link to content and services.
Link. You read that correctly. It didn’t pass. They wanted to tax links so we’d have to pay a fee to link out to free information on other sites. It’s about as insane as you think it is.
And the VATMOSS law got even dafter. It was created by the EU in 2008 with the following assumptions:
- Only big companies like Apple and Amazon would be affected
- Digital products are only ebooks and mp3s
- Small companies/micro businesses don’t sell directly to customers
We know exactly how wrong that is. Most of us could have told them within five seconds of looking how stupid that was. 100% of my sales on this website are direct to the customer.
The reason VAT is such a mess is that you can have multiple rates in one purchase, some countries require an invoice, many national systems aren’t done, and there are at least 81 different VAT rates (good luck coding for that). The tax bean counters have started to hit people up over €5 and less. Which I get, every Euro matters, but the law is a mess. It makes someone of the insanity of US State Law disparity look positively mundane.
There’s a great site called EU VAT Action that goes over this and they address the question everyone in the US should be wondering:
The rules apply to all sellers providing digital services to customers within the EU, no matter where in the world the seller is located.
It matters by who buys, not by who sells. And no, no one knows how this will be enforced. And no one really knows if methods like my ‘Sucks to be EU’ plugin, which prevent people in the EU from purchasing from this site, are fully legal. There are ways around it, of course, but does that mean I’m responsible for breaking the law or are the customers?
It’s sucky all around. It’s still sucky. And we have no idea when it’ll get better.