I don't understand what the gripe is here. You order something from overseas with a value over the threshold for VAT-free importation, then complain that you have to pay the due VAT and an admin fee to the delivery agent.
Whether it's Royal Mail, FedEx, DHL, UPS or whoever, that doesn't change the situation - they all charge an admin fee to collect the VAT. In fact, I believe that RM's fee is one of the lowest. I seem to recall other threads on here bemoaning egregiously-high admin fees from other carriers.
If it weren't that HMRC have arrangements with delivery agents to collect import duty and VAT, what would you have them do instead?
I guess my ‘gripe’ is that there should be a
reset of threshold to trigger VAT collection ...
Currently the threshold level for VAT collection is GBP15 – which equates to a VAT of GBP3 (20% VAT)
Because HMRC want to collect the GBP3 (based on the GBP15 threshold)
– this ‘triggers’ the Royal Mail admin fee of GBP8 (or any other courier with their own fee)
– which happens to be 2.66 times the value of what is being collected
I have absolutely no problem in paying VAT and always happy to contribute to the wellbeing of other’s via the TAX system
- but
I cannot accept such a large disparity – where the cost of collection is 2.66 times what is being collected How can this be fixed?Work out what is the minimum cost associated with the administration of collection
– Royal Mail in this case
– their cost of administration for collecting the VAT is GBP8
Let HMRC reset the minimum VAT threshold from GBP15
- to a level where the VAT will be
AT LEAST 1:1 ratio to the administration fee of collecting it
- preferably better than 1:1 which is 100%, say 20% - or whatever figure HMRC feels is ‘fair’ as a service charge
So,
if we make the collection charge vs. what is collected to a 1:1 ratio-
then the new minimum threshold for VAT should be GBP40 - making a VAT charge of GBP8 which equates to the GBP8 for Royal Mail administration charge
- giving us a ratio of 1:1, for VAT collected to cost for the collection
I used Royal Mail as an example
– because they would be the main facilitator which HMRC uses to collect the VAT in the UK.
Obviously other shipping companies will have their own administration fees – if at all.
The object here is to move the threshold of VAT to a level where the administration charge for collecting the VAT is not a ridiculous ratio of
2.66 times the value of what is being collected