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Subject: RE: UKNM: VAT and trading locations - RE: UKNM Digest V1 #115
From: Leslie Bunder
Date: Tue, 22 Dec 1998 11:32:29 GMT

Well, just had my latest CDnow order arrive and it was shipped to the UK
and there was a sticker on it with a UK postage mark on it! (thankfully
no VAT on the order!)

So it was delivered within the UK by the royal mail.

Leslie Bunder, technology writer
Teletext on the Web
e-mail: LBunderatteletext [dot] co [dot] uk
tel: 0171 386 3667 (UK) +44 171 386 3667 (outside UK)
mobile: 07010 701967 (UK) +44 7010 701967 (outside UK)
web: www.teletext.co.uk
post: 101 Farm Lane, Fulham, London SW6 1QJ, UK

> -----Original Message-----
> From: Steve Johnston/IMRG [SMTP:steveatimrg [dot] org]
> Sent: 17 December 1998 09:50
> To: uk-netmarketingatchinwag [dot] com
> Subject: UKNM: VAT and trading locations - RE: UKNM Digest V1
> #115
> Craig Pickup wrote:
> >This may also apply to the actual e-sales as the point of sale is the
> location
> >of the server not the customer. Therefore UK law relating to sales
> and VAT do
> >not apply if the server is located in the US.
> The point of sale is actually the desktop of the customer. If a UK
> company
> is selling to a UK customer, it has to charge VAT (If the product is
> vatable). Period. The argument that the server was in a non-vatable
> country
> will not stand up to even the slightest examination. The difficulties,
> however, arise when companies trade with consumers internationally.
> Presently there is no formal agreement, between anyone, about whose
> should apply, there are a number of arguments about country of origin
> and
> country of consumption, but common sense and market example is likely
> to
> prevail.
> Look at CDnow, previously they left the problem with the consumer, so
> on
> occasion, having bought your super-cheap VAT-free CD from the US a
> nasty
> surprise would arrive in the shape of a DHL bill for VAT on behalf of
> UK
> Customs & Excise and a small(ish) handling charge for DHL's trouble.
> This
> didn't happen too often, and the volumes were such that it wasn't
> causing
> any meaningful customer problems.
> You go to CDnow now and buy from their European centre, you will get
> added to your bill prior to shipping. So you are buying from a US firm
> with

> a base in Holland and yet are paying UK VAT.
> The answer lies in the customer experience and scaleable models. The
> tin-pot past had little of the first and none of the second.
> Steve Johnston
> Director of Development
> The IMRG
> www.imrg.org
> 07000 46 46 74

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