to have parcels delivered from abroad will cost much more

On July 1, 2021, e-commerce platforms will have to apply VAT on products coming from abroad. All packages will be taxed from the first euro up to 20%. This measure promises to upset the practices of Internet users, who often turn to sites like Alibaba to buy cheaper.

parcel delivery
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While La Poste now allows parcels to be sent from home, many products purchased are delivered from a foreign country. This is now a common practice, which has its share of advantages: a wider range of choices and, often, lower prices. But this last aspect is about to change dramatically. Until now, no tax was applied to packages with a delivery price of less than € 22. From July 1, 2021, all online purchases from countries outside the European Union will be subject to VAT, whatever their price.

A little math. In total, it will be necessary to add 20% tax for parcels from abroad. If the purchased product costs € 10, you will therefore have to pay a total of € 12, after adding the € 2 tax. A relatively negligible difference for low prices, but much more significant for high value packages. Electronics, in particular, risk of suffer hard from this new measure. Indeed, if you want to buy a new computer or a new smartphone on a foreign platform, it will be fashionable to take into account this increase of 20% on the final price.

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Online shopping habits about to be disrupted

“For consumers, this is a very big change, as it is supposed to mark the end of tax-free shopping on the Internet. From now on, they will therefore have to pay VAT upon ordering or delivering the product “, explains Yves-Marie Durand, director of the postal customs center at Chilly-Mazarin, in Essonne. “In France, we will thus go from 15 million electronic customs declarations to 450 million», Adds Olivier Dussopt, Minister for Public Accounts.

The goal is simple for the government. In view of the discount prices practiced by certain foreign platforms, or by French sites passing through international resellers, French products face a certain unfair competition. “We face competition from sellers, especially in China, who charge low prices without charging VAT and often split shipments to avoid tax”, adds the Ministry of Bercy.

More expensive parcels, but several billion in the state coffers

If the reference to Alibaba could not be clearer, many of them take advantage of the lack of legislation in the area to apply reduced prices. By applying this VAT to the first cent, the government hopes to recover pseveral billion euros in state coffers. E-commerce platforms have indeed greatly gained in importance in recent years, and particularly since the coronavirus crisis, which pushed consumers to prioritize online shopping.

For the latter, only the purchase price will change, says the ministry. “VAT will be charged by online sales platforms, and if this is not the case, by carriers”, underlines the latter. No additional administrative procedures on the horizon, then. Cdiscount, for its part, is already worried about the repercussions of such a measure. Although the site has “A lot of work to implement the device”, users will not be immune to some inconvenience. The platform provides in particular “Potential delays in deliveries from this summer due to the multiplication of parcel checks”.

Source: The Parisian

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