Over 100 eBay and Amazon sellers in the UK have signed a petition to bring the problems of Chinese and other non-EU sellers seemingly avoiding VAT to the Government’s attention.
The full petition reads: “Stop the £billion VAT Fraud on eBay & Amazon by Chinese, NON EU & UK businesses
£billions is being laundered out of the UK by NON EU companies on eBay & Amazon. UK fulfilment centres are dispatching their stock.
eBay, Paypal & Amazon must be forced to verify & display ALL business sellers details; company name, address & VAT status
NON EU sellers must display VAT numbers”
It’s clear from emails we’ve received from eBay and Amazon sellers today (and read on Facebook) that many feel very strongly that the laws as they stand, which as far as we know eBay and Amazon comply with, don’t adequately serve those UK based sellers who do pay their VAT.
We’ve written about this issue in the past.
However, at Tamebay, we are not sure this particular petition is the right way forward. We feel that the billions of pounds figure mentioned in the petition is unverifiable. We’re also not sure invocation of the term “laundered” is right and, most importantly, we don’t believe the petition text adequately explains the problem to anyone who is not already familiar with the situation.
If you’re going to campaign on an issue it must be clearly explained and this petition is lacking there. It is vital to mollycoddle both the media and the decision makers about the issue at hand.
We do agree with the cause however. There is no reason why any business seller promoting their sales on UK online marketplaces shouldn’t be required to display information that shows they comply with their tax obligations in the UK on every listing.
If the petition receives 10k signatories the Government pledges to respond to it. 100k signatures means it will be considered for debate in Parliament.
Will you be signing the petition?
25 Responses
You missed this part of the petition:
NON EU companies supplying goods located in the UK are required to register for UK VAT. There is no VAT threshold. http://www.hmrc.gov.uk/manuals/vatregmanual/VATREG37050.htm
However, thousands are trading on eBay & Amazon, using UK fulfilment centres such as Amazon, without being VAT registered or having their company & VAT information verified. http://www.vatfraud.org
The government will generate £billions in revenue & legitimate VAT registered companies will stop going bankrupt when this fraud is stopped
Quote “As a start. For instance: “All business sellers on eBay and Amazon should be required to display a UK VAT number regardless of their location.””
It’s a little more complex than that.
UK Sellers may not reach the VAT threshold
NON EU Sellers may not be dispatching stock from the UK so will not have a VAT number
NON EU Sellers pretending to be UK Sellers can trade with no VAT number
NON EU Sellers can setup UK companies and use them as a front then channel their sales to their Chinese company Paypal account without any trace of VAT being paid (there is a particular word for that but for the life of me I have forgotten it)
So not everyone from UK & NON EU countries will be required to have a VAT number.
Unfortunately explaining the full complexities & issues of VAT fraud on eBay & Amazon on the government petition site is impossible. It only allows an 80 character title, 300 character intro and a 500 character description.
So the petition is meant to raise awareness to the government who will then discuss a way to sort it out.
It is not meant for me to dictate on what new rules and regulations need to be put in place.
It’s just somewhere that we can use to raise awareness
With regards to the Billion figure I used. This figures has not been pulled out of a hat. I have spent a lot of time and effort researching sellers sales, making purchases and asking for VAT receipts.
I then complied a list of 500 sellers that could not provide VAT invoices. These sellers had combine sales of £300,000,000 in one year, Most have been trading for 3 or 4 years and will continue trading for another 3 or 4 years. If they are not stopped they will have made sales of well over a Billion and not paid a penny in VAT.
I think a petition to the government should absolutely ask for legislative and regulatory changes.
There is already legislation and regulations in force about displaying VAT numbers
https://www.businesscompanion.info/en/quick-guides/distance-sales/internet-auction-sites-and-marketplaces#Informationrequirements
I agree it needs sorting, Germany are bang on the button with this, as soon as we reached their turnover threshold a letter was received from them.
I would also point out that this does not cover the customs fraud where non-eu sellers, mainly from China, declare the incorrect amount on goods when entering the UK to avoid import duty, imagine how much that must be every year!
Please sign and share this petition everyone. This is a much bigger issue and effects us all. We want to be able to fight on a level playing field.
There is no escaping paying VAT for UK based businesses but we need to make the Government and HMRC look at this problem in more detail.
This is the single biggest issue affecting my online business!
The lost VAT runs into billions for sure, add on top the lost corp tax, lost income tax, and the jobs created, therefore lost NI and saved dole, and it is even greater. This is money sucked right out of the UK economy.
Its not just Chinese sellers, for my business its a foreign outfit operating out of another EU country on Amazon, they exceed the annual threshold every month, reported to HMRC almost 18 months ago and they are still happily trading.
All the data to stop this is sat in Amazon/eBay’s system, if you made them liable in some way they address the issue overnight!.
i hate these things, 100,000 people demand change, the government promises to ” think about thinking about it”.
the french know how to demand change, and get it.
I think a lot of people signing don’t really understand the issue themselves. They just don’t like Chinese sellers but don’t understand most of them are doing nothing wrong. Issue still needs to be solved but yes the message needs to be clearer.
I would like to sign this petition because recently a purchase that I made on eBay really annoyed me! I only buy from UK or so I thought!! Huge mistake!
The items that I bought were advertised as being in the UK on a UK site..but when my confirmation of payment came through ….IT was clearly marked in Chinese writing? I complained to the Seller that I did not want to buy anything from a Chinese site and was assured that it was coming from this country start to finish! But clearly I see now what was going on ….The money has just left the country! DUPED I AM!
Absolutely I am signing!
I think it would of been better if they just said non eu rather than chinese.
Ebay and amazon are sacred of sites like aliexpress and ioffer, so won’t offer favourable terms to chinese sellers in particular. But sellers on these sites despatch from China and not the UK.
Another thing to remember is this is a problem is in other countries as well not just the UK.
One thing we can all agree on is it needs to be sorted, but agree with tamebay I’d prefer a clearer better written description to sign up to. But at least someone has actually posted the petition rather than moaning, well done to the guy.
Its EU and non-EU sellers, there are many people selling into the UK from other EU countries, exceeding the annual thresholds for registration, and not paying VAT in the UK or their home country, same problem as the non -EU sellers who are mainly Chinese.
Have said before that the only way to deal with this is for HMRC to implement a witholding tax, means Amazon and Ebay would have to take a percentage of sellers sales proceeds and send direct to HMRC, seller then claims this back through VAT or Tax return,. Would mean overseas sellers would have to increase prices to cover the tax, and would also mean non registered UK businesses would pay
This system has been in use for years in the Construction industry, and has been very effective.
Would raise several million for HMRC and help honest UK traders
So my petition could have been better. I’m going to try and get it edited
If you feel you could write a petition that better explains the situation please post it here
You have 80 characters title, 300 character first paragraph & 500 characters second paragraph.
The petition has to be fully explained in the title.
Spaces & carriage returns are counted as characters
Let’s hear your petitions.
Whilst VAT evasion is irritating I don’t think failing to enforce it makes any difference in reality to my business
I want to sell items at £11.99 that Chinese and others will sell for £2 to £4. Even if they have to have VAT added to that they will still be considerably cheaper than me. I have to find other ways to compete other than price
Bryn