eBay have responded to the article in the Daily Mirror reporting that Chinese sellers on eBay UK are evading VAT.
We’ve had quite a bit of correspondence from sellers in addition to comments on Tamebay on the matter and we know it’s tough competing with overseas sellers and that would be doubly so if they had a 20% VAT advantage.
The key headline is that eBay have cross checked all of the sellers named in the Daily mirror article and say that they are all registered with HMRC. One of the interesting facts revealed by eBay in their statement below is that they’ve done a lot of work over the past few years to make sure that Chinese sellers are aware of there obligations.
Where this leaves the situation is exactly where it should be, these sellers shouldn’t be being named and shamed, it should be left to HMRC to ensure that any VAT or other taxes due is collected in the same way as they do for UK sellers.
It’s unlikely that HMRC will divulge details of how much VAT has been paid, if any sellers are behind with VAT returns or if they’re all fully paid up members of the UK tax fraternity. That’s the same privilege that’s accorded to you and me and hopefully that’ll be the end of the story, although we understand that the Daily Mirror had planned on a follow up story. If a follow up is published it will be interesting to hear what else the Mirror has to say.
eBay’s statement in full
“We understand that all of the Chinese sellers mentioned in last week’s Daily Mirror were issued with UK VAT registration numbers. These VAT registrations were achieved as part of an outreach exercise eBay started in 2012 to educate overseas sellers on their UK tax obligations. This has resulted in 450 overseas merchants with UK inventory registering for UK VAT. eBay’s efforts in this area continue and we encourage all eBay sellers to maintain up to date and accurate information on their business location and VAT status. All sellers should display their VAT registration number with their business information, and we will be following up with sellers that are not currently doing so.
We take the VAT and tax compliance of our sellers extremely seriously. All non-UK sellers with inventory located in the UK should be UK VAT registered, and we cooperate with HMRC in all cases to help them enforce the law where there is evidence of underpayment of taxes. Where we identify sellers that are not compliant, we take action to suspend their accounts.
At the request of HMRC, we provide information on any sellers, UK or overseas, where there is evidence of underpayment of taxes. We are verifying all information in the report submitted including the sellers you specifically mentioned. We will take appropriate action if we find evidence of wrongdoing“.