UK VAT Law

In effect it has, yes .. but frm my point of view this is not because LL "raised the price", it's because your governments want to tax LL's receipts at a ridiculously high rate. It has nothing to do with LL's pricing policy, and everything to do with the EU's taxation policy, so the blame for the additional cost lies with your tax authorities, not LL. Yes, LL should have communicated better, given more warning, and all of that -- this was terribly bungled from that perspective. But it isn't a "price increase" -- you are paying more because of Brussels and its silly tax regime. Although I suspect I feel this way because it is what I am used to in North America, I do think that separating the "price" from the "tax" helps the customer understand better whom to blame for the total cost (ie, what is in the merchant's control, and what is the tax man's doingt), while the all inclusive system lets the taxman hide behind the "price".

Evil things, Sprouts



Some businesses in the UK still do quote prices before VAT, particularly those who sell to trade, but by law they have to state explicitly if the price does not include VAT. Most companies of course offer goods and services to the consumer, and all the consumer wants to know is the amount they need to pay. I suppose it just comes down to what you are used to, but I think inclusive pricing, particularly when the rate of tax is constant, is just more practical for the consumer.

The way this was handled was certainly less than ideal. In particular I am not too happy about the fact that I am paying the increased rate for a period which falls before the email went out, as tier charges cover the month leading up to the billing date. Not only was there no notice, we had 'negative' notice!

the main fact is that the price has already included USA tax ,so that means we paid USA tax all along , the question is why we paying that for ??? and why we never knew about it ???
the ones interested in discussing this matters about VAT join in-world group " AGAINST VAT IN SL "

How many times does it have to be said that you are not paying any US state sales tax?!

I'd really like to know more about this, too. If true, this aspect will, by far, be the most troublesome for LL.

I think there are so many people stating opposing opinions on this as fact, it's very confusing for those of us who do not understand the American tax system. I've got to the point where I am pretty indifferent about it, so I won't be chasing it up, but I would like to know just out of interest.

It is more practical for the parasites in government because it hides how much you are truly paying them. I know when I buy something here exactly how much my government is stealing from me.

And I know how much I am paying here, too. The rate doesn't change, it's always 17.5%, and is accepted as a given. I just feel it's more practical as your average consumer just wants to know what the overall damage is.

Not only do you have to say if a price is excluding tax, it has to be written right next to the price so the customer can see at a glance and not have to look for the details. This is usually only used where it's business trading with business, where you are trading with the general public the price shown must include VAT.

If charging VAT on goods/services, you also have to supply a VAT receipt to anyone who requests one, without a proper one, anyone doing business and claiming it back, which they are entitled to, cannot.

The SL price lists still don't even mention the extra costs and someone new looking to see how much they can afford wont know the true cost until too late and purchase already made.

LL does have an office in the UK and as such could easily be fined by Trading Standards for hidden charges.

Just to clarify -- noone is Europe is paying ANY US sales tax. Period. The only posters who are stating otherwise are Europeans who are angry (rightfully so, imo, given how LL has handled this) and looking for something to latch onto, but anyone in the US can tell you that you are not paying any sales tax in the US. The sales tax is *never* built into the price here, number one and, number two, US federal law prohibits sales taxes on internet services.

How are the costs hidden? You know what the base price is. Do they not have calculators in the UK so you can figure what your tax is? You know you have to pay it. There is no reason on this earth why LL or it's customers in places outside the EU should be paying your tax for you. All I hear is "We have free healthcare, we have this government handout, and that govenment handout." fine you are riding the government gravy train, you pay for it. Don't expect the rest of the world to support you.

I guess the sheep doesn't really care who is shearing him.

That's fair enough Victorria, it did seem a bit odd.

Well personally I can work out 17.5% of a number without need of a calculator. As for the rest of the post, I'm not really sure why it is in reply to what I have said; I can see no relevance at all. From the end of your post, it would appear you have a bit of an axe to grind. Have fun with that

It's just that they're not used to it, Chris. For you and me, I *want* to know how much the tax man is taking, and how much the merchant is taking. Plus, our sales taxes are a lot lower than in Europe, so we kind of figuire it will be 5-7% more than the price, but it isn't a big deal -- 20% more is a big deal. And, they tend to have unitary nationwide sales taxes, which we don't either -- we have like 45 different state sales taxes, a handful of local sales taxes and so forth. So it's a cultural thing, but a cultural thing that the Europeans have written into their laws, and I'm sure LL isn't complying with them because they price thing like we do in the US. Still that is easy enough to LL to fix, it seems to me.

No, he just doesn't need a speadsheet to know who is shearing him.

I really wouldn't know, I am not a sheep.

The costs are hidden as there is no mention of VAT to be added on the pricing pages:

http://secondlife.com/whatis/landpricing.php

http://secondlife.com/whatis/plans.php

http://usd.auctions.secondlife.com/

http://secondlife.com/apps/mapapps/buy/


All of the pages listing prices have no mention of the fact that some will be subject to between 15% and 25% on top of what is shown, here in the UK (where LL has an office) it's classed as hidden costs and illigal.

Oh don't worry, you have already clearly seperated yourself from those you view as 'sheep'; you've no need to state it explicitly, I can assure you.

Yes so they goofed and they will fix that certainly. They've priced things the way that is customary in the US, and this doesn't comply with UK law so they will need to fix that. I would think that the bigger issue is the long term fact that you will be paying 17% more, and foot faults like this, which will be fixed, aren't going to change that.

I doubt LL deliberately hid the costs. As someone else has already pointed out, part of that is probably down to cultural differences, but part is also due to the terrible handling of the issue.

R USA IZ BETER DAN UR EU PPLz!

Seriously, did somebody actually mention free healthcare in this thread apart from Chris?

ROFL

I really don't understand why everyone is getting hung up on "cultural" differences.
It's quite simple -

26th September - Land Tier for all = US $75
27th September - Land Tier for US Residents = US$75, but for UK Residents = US $88.13 - an increase of 17.5% and for others in the EU the increase will mean that the same Tier now costs $93.75

Regardless of where the money goes, in effect, the cost of SL for EU Residents HAS increased (15% - 25%).

Since USA Residents don't pay any tax on internet services, the cost has remained the same for USA residents, but has gone up for EU residents.

I know that this isn't LL's fault, but it could have warned us in advance instead of sending an "after the event" message to only SOME (but not all) EU residents.

And, as I said before, the repercussions will have an effect on ALL SL residents. Think of it like this:

1. You pay rent to your landlord every month of $1000 (or whatever).
2. After all your other household bills are paid, you have $100 to spend on cookies.
3. You spend $100 on cookies - The Cookie Guy makes money!
4. The government (not the landlord) imposes a new tax on home rentals.
5. You pay rent to your landlord every month of $1100 (and the landlord gives $100 to the government).
6. After all your household bills are paid, you have $0 to spend on cookies.
7. You spend $0 on cookies - The Cookie Guy makes NO money!

In this instance, since the majority of SL residents are USA residents, then probably the majority of vendors ("cookie sellers" in SL are also USA residents. Which means that your sales will be affected by this sudden increase in costs for EU SL residents.

Please try not to moan too much when this happens (I'm assuming that Chris Norse does not sell stuff in SL, but if s/he is I wonder who'll be moaning most loudly!)

VAT doesn't pay for health care, national insurance does. If you're going to try and belittle us because we actually care about people who can't afford private health care at least aim your fire at the correct tax.