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Buying Oculus from VAT free EU territories

Nacho_Odinson
Explorer
I pre-ordered Oculus and see that VAT is included in the 700€ price. While that would be correct in most cases, I live in the Canary Islands (Spain), where we are not required to pay VAT. This is because we here have a different TAX called IGIC (7%) that will be charged to me at Customs when the item arrives plus some extra import fees.
I understand that Oculus charges VAT because they will be charged that amount by the countries where they sell, but that is not the case here. So, I would end up paying the equivalent of VAT to Oculus with no reason, because they will not be required to pay it in taxes since they are selling to the Canary Islands and then I would also have to pay 7% extra (maybe 7% of the 700€ total, because my country will assume that it is the total price without VAT) and plus import fees at Customs.
I already contacted Oculus Support about this and am waiting for a response, but I would like to know if someone of the staff here knows something about this and if it is possible to discount the VAT in my case (or for anyone in my situation).

http://ec.europa.eu/taxation_customs/ta ... dex_en.htm

Articles 5 and 6 way down there, is a long page: http://eur-lex.europa.eu/legal-content/ ... 32006L0112
19 REPLIES 19

Syrellaris
Rising Star
You pay Vat because it is the Tax system of Ireland and the UK. The item is shipped from Ireland.

Nacho_Odinson
Explorer
I know. But if VAT is applied or not depends on where you buy it from. It is stated that VAT is never applied to items sold and delivered to the Canary Islands and that the local authorities are the ones required to charge me my taxes. I simply dont want to pay taxes twice.

http://ec.europa.eu/taxation_customs/co ... _eu_en.htm

Impulsor
Honored Guest
"Nacho_Odinson" wrote:
I know. But if VAT is applied or not depends on where you buy it from. It is stated that VAT is never applied to items sold and delivered to the Canary Islands and that the local authorities are the ones required to charge me my taxes. I simply dont want to pay taxes twice.

http://ec.europa.eu/taxation_customs/co ... _eu_en.htm

Unfortunately you are still paying the taxes required to ship it to europe. Since its shipping to Ireland first, apparently.

I'm Spanish too, I know the pain. It sucks.

Nacho_Odinson
Explorer
I am not required to pay VAT, doesn´t matter where it comes from. It is part of the EU policy. Im only asking Oculus to do what is legal. If not, they will simply charge me extra for the Rift and end up keeping it.

Nacho_Odinson
Explorer
Quote from the European Commission webpage I linked:
"The Canary Islands are not part of Community territory for the purposes of VAT (Article 6 of VAT Directive).
The harmonised rules on VAT do not apply to the Canary Islands and the application of turnover taxes is a matter for the national or local authorities subject to respect for the general principles of the Treaty on the Functioning of the European Union and, notably, the absence of discrimination in the taxation of products.
VAT does not exist in the Canary Islands but there is a local consumer tax known as the IGIC (Impuesto General Indirecto de Canarias - Canaries General Indirect Tax) applied at several different rates. There is also another consumer tax known as the AIEM, which is discussed below."

crim3
Expert Protege
Maybe is some kind of import fee for the EU, because they are chargin they same ammount for all countries in the EU despite VAT rates being different in each one.

It would be a really unpleasnt surprise if once it reaches here I still have to pay VAT, though :s

PoisonVenom
Explorer
Sounds complicated.. I would move to another country if I were you 😛

Nacho_Odinson
Explorer
"crim3" wrote:
Maybe is some kind of import fee for the EU, because they are chargin they same ammount for all countries in the EU despite VAT rates being different in each one.

It would be a really unpleasnt surprise if once it reaches here I still have to pay VAT, though :s

It is not. All my import fees, along with taxes will be charged to me by the local administration once the Rift arrives at Customs. It is simply how the EU has stated it for my territory and since Oculus is selling the Rift in the EU, the law should be respected.

Dark-Sider
Honored Guest
VAT is a PITA how Oculus does it.

AFAIK they have an import agency, that pays the import-VAT in UK or Ireland (or whatever country they chose to unload their containers) and bill the paid VAT to Oculus. Oculus in return adds the VAT upfront to the price of the device.

Although VAT is paid and authorities are satisfied, the customer does not receive a compliant invoice. (Which on the other hand is not necessary as oculus is not a EU-company).

However chosing the path and dealing with an import agency has side effects - like in your case, when the shipment should be VAT-free. Or in my case I could get the VAT back because I have a company and I'm not required to pay VAT for parts needed in my business.

I also don't understand why the have to bill me in EUR - which leaves the risk of changing exchange rates @ oculus - but of course oculus knows that the EURO could drop and adds some extra on top for that reason.

The shipping costs of ~42 € would allow a direct shipment via a major parcel service directly to the customer. If I was the importing entity I could get all taxes back, and I'd be happy to pay 599 USD + Shipping to oculus on the day they ship my device. Let the exchange rate be my risk - not yours!