Tariffs are usually charged at the landed cost of the product in the country - thus it includes the freight cost of the goods from seller to purchaser...
Tariffs on used audio gear
- Thread starter sbo6
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Tariffs are usually charged at the landed cost of the product in the country - thus it includes the freight cost of the goods from seller to purchaser...
From quick web research:
The difference between VAT and tariffs
The perception that imports are more heavily taxed may come from confusing VAT with tariffs. These are two distinct types of taxes:
A Value-Added Tax (VAT) is named for the fact that it is a consumption tax levied on the "value added" at each stage of a product's production and distribution. Unlike a sales tax, which is charged only once at the final sale, VAT is collected incrementally by businesses throughout the supply chain.
The difference between VAT and tariffs
The perception that imports are more heavily taxed may come from confusing VAT with tariffs. These are two distinct types of taxes:
- VAT: A consumption tax that applies equally to both domestic and imported goods sold within the EU. It is not intended as a trade barrier.
- Tariff: A direct tax or duty placed only on imported goods. Tariffs are specifically used to protect domestic industries and regulate international trade. When you import an item into the EU, you might have to pay both import tariffs and VAT, depending on the type and value of the good.
A Value-Added Tax (VAT) is named for the fact that it is a consumption tax levied on the "value added" at each stage of a product's production and distribution. Unlike a sales tax, which is charged only once at the final sale, VAT is collected incrementally by businesses throughout the supply chain.
I do not know the phrase "the landed cost of the product in the country".
According to the ebay ad the purchase price of the headshell included shipping. The 'fee' I paid went to DHL.
Anklebiters.
By landed costs he meant the purchase price for the product plus freight.
The import duties (VAT on the “landed costs” + perhaps handling fees) go to DHL because DHL paid them when your order went through customs.
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"the landed cost of the product in the country" = cost of the goods (say in Japan) + freight from Japan to the USA is the landed cost. This process would apply to goods bought in Japan direct or through Yahoo Auctions Japan to give but two examples.
Its a little different with Ebay as they calculate the (most expensive) freight component as part of their sale process...
I have two recent experiences with international buying in the USA.
The first was a roughly $700 USD vinyl accessory that is vital for my front end. It comes from a small Japanese manufacturer who has introduced a new model. I am looking for a replacement. No dealers in USA carry this new model. I've found at least 5 dealers in Europe that do. None of them will sell to USA buyer now since the tarrifs. I will have to wait till a friend goes to Europe to ship to them in the future I guess. I am basically out of luck. Must be a PITA to sell to USA now.
The second I purchased a Korf Ceramic Headshell from Britain. Lovely seller, easy one price including shipping. 199 pounds, works out to about $250USD. Sent via local courier to UPS. Took a bit over a week to come. Tariff charge was about $35. There was an additional $15 "Brokerage Charge" I'm guessing that was a 'dealing with customs charge' that might include some customs processing fee. So just about an even $60. Easy pay with a link by UPS.
The first was a roughly $700 USD vinyl accessory that is vital for my front end. It comes from a small Japanese manufacturer who has introduced a new model. I am looking for a replacement. No dealers in USA carry this new model. I've found at least 5 dealers in Europe that do. None of them will sell to USA buyer now since the tarrifs. I will have to wait till a friend goes to Europe to ship to them in the future I guess. I am basically out of luck. Must be a PITA to sell to USA now.
The second I purchased a Korf Ceramic Headshell from Britain. Lovely seller, easy one price including shipping. 199 pounds, works out to about $250USD. Sent via local courier to UPS. Took a bit over a week to come. Tariff charge was about $35. There was an additional $15 "Brokerage Charge" I'm guessing that was a 'dealing with customs charge' that might include some customs processing fee. So just about an even $60. Easy pay with a link by UPS.
It is more complex than it seems, particularly if goods incorporates parts coming from outside the European Community. When a distributor gets gear from outside the EC, he must immediately pay the VAT on the goods and shipping, and pay an extra VAT parcel on his profit when he sells it.
Most times the shipping price in the eBay auction is just an estimation determined by the seller. When using DHL, if the international shipper does not clearly separate the price of good and shipping on the invoice , customs calculate the tax on basis of the total value added to DHL higher shipping cost for such freight.
As they say, in gambling and taxes the house always wins ...
and there is also the complexity of different VAT rates charged for different goods, which also appear to differ by country. Who tracks all these transactions?
The national authorities and a very complex european TAX system ...
Even ChatGPT needed an extremely long post with several organizations to answer your question! But it seems to work properly.
I can see why import taxes (aka tariffs) on top of all that complexity are unwelcome! Perhaps the European national authorities are using AI to help manage it all.
But I would be cautious using AI's help. I recently read about people who use AI to help them establish a household budget and to suggest ways to save and earn money. AI told one woman she should sell photos of her feet on the internet to earn money. I was eating while I read that and literally spit out some food (laughing and eating are not a good mix).
djsina2,
Thank you for the link. In reading the link, it is speaking to "duty" (Custom Duty) considerations, which per, my understanding, is different from tariffs. The link also is speaking to American Goods Return (AGR) , and discusses goods made in the United States.
Though I did not specifically indicate in my recent post question, I was thinking of goods purchased in the USA , but manufactured offshore and requiring warranty/repair service by the manufacturer location. The "duty" discussion in the link did indeed mention repair. It is possible that tariff considerations may adopt similar guidelines. Repair under warranty was not specifically discussed. A perspective on this could be that warranty was part of original cost of sale, but not knowledgable if that is how such is viewed under duty and/or tariff consideration for offshore warranty.
I suspect if needed, we should inquire directly with US Customs and Border Protection for clarification. I think it may be wise to do so in writing to get a written response, though how long that could take to get written response could be problematic. We could also communicate directly with our dealer(s) and manufacturer, but very possibly they will not have certainty.
Thank you for the link. In reading the link, it is speaking to "duty" (Custom Duty) considerations, which per, my understanding, is different from tariffs. The link also is speaking to American Goods Return (AGR) , and discusses goods made in the United States.
Though I did not specifically indicate in my recent post question, I was thinking of goods purchased in the USA , but manufactured offshore and requiring warranty/repair service by the manufacturer location. The "duty" discussion in the link did indeed mention repair. It is possible that tariff considerations may adopt similar guidelines. Repair under warranty was not specifically discussed. A perspective on this could be that warranty was part of original cost of sale, but not knowledgable if that is how such is viewed under duty and/or tariff consideration for offshore warranty.
I suspect if needed, we should inquire directly with US Customs and Border Protection for clarification. I think it may be wise to do so in writing to get a written response, though how long that could take to get written response could be problematic. We could also communicate directly with our dealer(s) and manufacturer, but very possibly they will not have certainty.
This is not how it works in the EU. The VAT paid on purchases is deductible from the VAT the company charges to its customers - hence the term “value added tax”. Normally, VAT collected will exceed VAT paid.
If the VAT paid exceeds the VAT collected (for example if for a given month purchases exceed sales) the tax credit can be deferred.
In the case of export sales outside the EU, no VAT is collected, but the VAT paid (on purchases) is still “deductible”.
Anyway, the system is not that complex (all the different sales tax in the US are not so simple either).
The fundamental criticism of VAT is that it is “regressive”, meaning that it represents proportionally a higher burden for those that have lower income.
Sorry, it was what I told - the distributor pays the VAT just on the amount of the goods at the time he gets them (the factory price) and just pays the extra value to the tax people when he sells. Otherwise it would be double taxation! Although some forms of deduction are possible, in the end the finances get all the amount paid, directly or indirectly.
Yes.
Well, at less it is more complex than what we had before. And proper optimization of VAT strategies can save a lot of money to companies.
I will not enter a political debate on VAT, sorry. But we could say that audiophiles are good citizens, they spend a lot on taxable goods!
You do not seem to understand the mechanism of VAT. The Wikipedia page has a good example:
The burden of the tax is all on the end consumer, but collection and repayment back to the state is actually shared by all actors in the supply (value) chain.
Stating that sales taxes are regressive is not a political statement and is not open for debate! It’s a fact.
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