The German tax authorities have cracked down on Chinese sellers trading on Amazon in a big way. Following HMRC’s struggles to get Chinese sellers to register to pay VAT, Germany have gone nuclear on potential tax evasion.
German marketplace blog Wortfilter reports that Germany has required Amazon to freeze all assets of Chinese sellers who are under investigation. This includes a freeze on any funds in their Amazon account as well as confiscating their inventory in Amazon FBA.
“Amazon receives notification from German” tax institute “(ie tax office) that it does not fulfill the requirement of regulation of German sales tax”. You are not allowed to sell on Amazon. You may not take back your inventory in FBA, because German laws require us to block the goods until you have met the requirement of German tax authorities. If you still have funds on your Amazon Payments Europe SCA account, it will also be blocked as requested by the German tax authorities”
– Wortfilter translation of Amazon message to Chinese sellers
Naturally Chinese sellers are going ballistic – according to local chatter FBA items funds in the multiple millions of Euros have been seized and Amazon aren’t going to be releasing the funds or the stock until the sellers impacted settle up their tax affairs in Germany.
The German approach is somewhat admirable compared to the UK, there’s been no messing about, just a simple confiscation of goods and funds until the sellers make good their tax affairs.