Update on European Union import VAT

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Last month, we announced that beginning July 1, new European Union tax rules will change the way import tax is collected. Here’s a little more information about what you can expect starting in July:

Etsy will begin collecting import VAT on physical goods under €150 that are shipped to the EU from an outside country.

For items under €150, the listing price shown to EU buyers will include the import VAT amount, so it will be easy to understand how much they’ll pay for your item at a glance. This VAT will be automatically collected from the buyer at the time of purchase, then sent to local tax authorities on your behalf.

How to prepare:

Read more about the VAT rates EU countries will be charging for different types of goods
Think about your business plan and pricing strategy since EU buyers might pay more for your items, then make any necessary adjustments ahead of time!

What to do after July 1:

You must share Etsy’s IOSS number (which can be found under Orders & Shipping in Shop Manager), directly with your shipping carrier, and you must not use it for any other purpose. Never write this number on your packages. The shipping carrier should submit this information electronically. This helps to ensure that your buyer won’t be charged VAT twice.
Using shipping labels purchased from Etsy? We’ll do this for you.

Note: Always double-check this intake process with your local shipping carrier as it may vary. Some shipping carriers, such as Royal Mail for example, cannot accept or submit IOSS numbers in post office locations, and you may only be able to do this online. If your carrier cannot transmit our IOSS number electronically, the buyer could be charged VAT a second time.