Friday, 2 January 2015

My Response to the EU VAT debacle

You have probably heard by now that, on January 1st, the EU VAT on digital goods/services kicked in. What is the EU VAT? Well, your guess is as good as mine. To make a very long story very short, my understanding is that the EU wants sellers to pay tax on digital goods and services that are purchased from customers in their countries, irrespective of where the seller is based. Even shorter and incredibly basic...if I, in Australia, sell a pattern to someone in France, I have to keep records and give money to France. Now it's obviously much more detailed and complex than that, but it gives you the general idea of why the pattern writing world (or the digital world for that matter) is all in a tizzy.

The following blogs do a great job of telling you all about the situation and I highly recommend reading them:

The two main opinions I have seen from Australians are "it doesn't affect me, they have no authority here" and "it does affect me, by crikey what am I going to do?".

A part of me says that they have no authority and given that the Australian Tax Office doesn't seem to have any information on it, why should I listen...but...I am a believer in following the rules and if I don't understand a rule, I stop doing what I'm doing until it's made clear. I'm not an 'act and ask forgiveness' kind of person. I have nothing against people like that. I'm just not one of them. Enough big names are concerned for me to believe there is an issue.

Where does this leave me? Until I am 100% convinced that I am immune to having some French tax collector rock up on my doorstep, threatening to break my legs over three dollars, I will not be selling patterns to EU countries. For the record, yes, the French tax collector is wearing a beret and stripey shirt, smoking a cigarette and riding a bicycle...with a brown paper bag of groceries and baguette poking out of the basket.

What I specifically do is yet to be decided. I will still be releasing patterns, hopefully worldwide, but how they work their way from my computer to your sewing table, is anyone's guess. I do have one rather unique idea that I'm nutting out, but I don't want to give it away at this stage. Just in case it actually works haha. This idea isn't a result of EU VAT, I've simply been given the nudge I needed to put more thought into it.

To sum up....there are issues in the digital world but I will still be releasing patterns while complying with all laws and regulations I must follow.

If you have any questions about my plans, please don't hesitate to comment below. If you have any questions about EU VAT...I would probably suggest contacting someone that knows what's going on. Better still, find an accountant or lawyer that can give a definite yes or no and then give their number to me hahaha.

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