European Union + Value Added Taxes in SL?

I have a question on behalf of a European SL friend (who does not speak English) concerning the European Union charging SL residents value added tax on their premium memberships, sim purchases, land purchases and monthly tiers. It sounds like the governments on the other side of the pond have decided to extend their greedy hands into the pockets of our European friends? I take it this is some form of sales tax? and one can not get away from it period ... unless:

"If you are a business and are reselling, or adding value to our product before providing it to a consumer, you are eligible to provide your EU-issued VAT ID number to be excluded from this assessment."

Does buying a sim/land, developing it and adding value to the customers of the sim qualify as value added? Of course my friend would have to have this VAT business ID number right? Anyone in Europe care to shed some light on this issue?

Ughhh ... governments are the worst. They are sharks. They steal money from us and offer us little value in return.

to sum it all up:

we in europe are screwed, every one outside europe is fine

The problem I see with all of this is that there haven't been any government announcements anywhere that I've seen regarding the legitimacy of another country charging another country's residents tax.

At aiports, you have 'duty free' shops where you can buy stuff without paying tax, because it is classed as an 'international area' rather than in that country. Shouldn't the internet be treated exactly the same, as it belongs to no one country?

Broccoli

My friend is not going to like this. So she can expect to have the EU in her pockets every month for her premium membership and tiers for the new island she has started up (and has no residents besides yours truly renting on yet). Plus I guess tax for the initial sim purchase? Ughhh ...

So the 100% tax funded healthcare that every EU country (except France) has is "nothing" then?

Your friend does not need a VAT business ID - LL do. It is LL that are being charged the VAT and passing the cost on. Your friend will be paying VAT on his telephone or electricity bill too, and if he buys a TV he pays VAT on it - it is a sales tax that is paid by the retailer and passed onto the customer as part of the sale price (but must be itemised accordingly on any bills).

Where do you get this nonsense? As example in Germany you have to pay health insurance, it's in the range of 13-15 percent of your income. Get your facts straight...

Not true sweetheart, I pay 120 euro (~170 US$) each month for health care. And for your information: it is not optional. We HAVE to insure us for healthcare...

I hightly doubt Linden Labs has company code or VAT code number in Finland nor that they are paying VAT to finnish tax authority. If they are then i am wrong.

The Dutch revenue service states that any internet order below €22 should not have a VAT added... I think this applies for most tiers by residents.

shit, still screwed

Doesn't that apply to shipped items only; not services?

HM Customs & Excise have a similar rule. VAT is slapped on shipped items worth £25 or more, and gifts of £35 or more. I think that's why every American Ebay seller I've dealt with has written 'gift' and something like 'worth $10' on the customs slip.

In the UK we pay National Insurance on top of our tax which is to fund our health service, not the tax. This is deducted from our pay packets before we recieve it and employers have to pay an extra contribution.

That is the exact reason why so many are upset over this... that there was NO warning so people could make informed choices when buying up in SL.

Not true. The NHS is funded through progressive, general taxation. The NI contributions you make dictate the benefits to which you are entitled throughout your life (unemployment benefit, statutory sick page, maternity pay, state pension, etc.). The NHS is funded the same way as education -- via money raised from tax.

I would appreciate If LL would give me their vat registration number in The Republic of Ireland and what rate of VAT are they applying. Anyone who is charged VAT has a right to have a VAT registration verified.

VAT registration in the EU only has to be done in one member country - LL's UK based VAT number is an EU one and is recognised in all EU member states, They do not need seperate registration in Eire, Finland or any other EU state .

this vat thing is just a rip off from LL .i never heasrd about a law that you have to pay taxes for an internet service.sl is no buisness for me,i dont earn money with it,i just put money IN that game.and what the heck is a VAT number? i dont got such a thing.just buisness people irl have such a number.im just a poor unemployed resident that tries to have some fun with sl.this nonsense is illegal in germany.what should that be? some kind of amusement tax?well if one have to pay now taxes for amusement,then thats really a evidence of incapacity for LL.ill get rid of my lot and downgrade to basic.
LL really got balls just to charge taxes from any european resident,no matter if its right or not.
is it easy to see that im not amused anymore???

Yes there is a 2003 Bruxelles Edict that imposes this tax. It's referenced in a number of threads, as well as in the link on LL's blog.

And it's in the Knowledge Base: EU826011179

well even if there is one.i guess its just for buisness in the web and the taxes are normally included in whatever you pay in the internet in rl.aand not added on top.
i personally never had to pay extra taxes for something i did via internet.i pay my phone/internet bill and thats all i have to pay.

Has anyone in the EU called and asked people power in your countries if LLABS could do this? That might so answers
What pervents people in the EU lieing and saying they are not in EU countries?!

I do like these bizarre notions some people come up with.....

I wish..!!

Guess what? that phone/Internet bill of yours has VAT included in the total. You've been paying tax all this time and never knew it!

There are several things which gives it away where you reside.
1) Your IP address is country specific.
2) When you sign up you declare your country of origin.
3) Your CC or method of payments are origin based.
4) Your email address is traceable to you as well.

VAT is chargable for any services that we in the EU use whether from within the EU, or when it's 'Ported' to a source within the EU. The limitation of £35 here in the UK is relevant only for value of 'Gifts', paying LL for services isn't a 'Gift', it's a service. It is no different to paying for a webhost.
What I found intriguing is the statements 'Services paid to LL, which includes land sales, tier etc', we bought our land from a third party who is not a member of the EU, and we pay tier to them each month. As they are not VAT registered, and cannot be outside the EU, they cannot actually charge us. As they pay LL, I don't suppose they will be charged VAT as they are in the USA, and not registered to collect VAT.

Its a falsehood to believe that any taxation revenue will go to the department that the name suggests. If that were true then the £1.7 billion raised each year in Road Tax, would go on our roads and we would have the best road system in the world, same with the education and NHS sectors. All taxation in it's various guises go into a central fund at the treasury and is split into the various budgets requested by those departments. The war coffers were recently (since the Falkland War) were increaded by some £50 Billion, all funded via central taxation.
If you look at the recent declaration of the Government here in the UK, they are now charging for household rubbish, either by weight (your wheelie bin will be barcoded and your CC will be charged, or you purchase fixed sized bags), when in reality this is in addition to the 'council taxation bill, which already includes for this element, no rebate will be offered to offset this additional charge. The Net result will be an increase in 'fly tipping' and adding rubbish to neighbours Wheelie Bins to escape increased costs (I forsee a lockable type Wheelie Bin being introduced at some point, or coded bags).

It was reported in the 1990's that the £ was close to becoming a free falling currency, as the pound was being taxed almost to the point of 95% from the time it left the Bank of England, and back again. At 96% the economy goes into freefall and we end up with a loaf of bread costing £1,000, in a similar way to the Italian Lira. Our Chancellor bought £80 million pounds sterling from the internal banks in one day, trying to boost the pounds value on the open market. It was a close call, and thankfully we survived an on going recession. Another 20+ taxes have been introduced into this country since those times, under the heading of 'Stealth Taxation'.

Back in the 1970's when VAT was introduced, is was assured that it was only for 'luxury goods' at a fixed rate of 8.5%.. more ploitical lies. VAT stands for nothing but another stealth taxation system. It costs business's in the EU Billions of currency each year to administer. Given the many laws that divide VAT into Non-Vatable, Partial-Vatable and Full-Vatable, even the Customs and Excise get confused what is and what isn't VATable. If you make THEIR mistake, you are responsible to make financial amends. As VAT comes under the Customs and Excise, they are the only department that do not need a court order to enter your premises and confiscate anything they think of value to pay off any VAT owed.