Digital Services Tax
Can somebody please explain how this new digital tax will work, is it going to replace Referral fee?
Digital Services Tax
Can somebody please explain how this new digital tax will work, is it going to replace Referral fee?
12 replies
Seller_ZJhFeE3tNKzfh
Not sure what new digital tax you are referring to sorry.
Seller_d8YGbIjNqwFxn
According to the email it won't. Referral fees look like they are being reduced as they already include DST. DST then becomes a standalone fee.
DST is payable depending on which country you operate from.
I am assuming if you operate from a country not mentioned in the email then you don't have to pay DST. Although it is not clear
Seller_76AUwmqvSyRIM
Until now, the DST was hidden amongst the various fees. When the DST was announced a few years back, Amazon just increased the fees so that they don't lose out. This was a bit sneaky as the tax is on their profits, not on the sellers but that's another point ( I don't think that ebay charge sellers the DST).
Now, they will reduce the fees but charge a separate DST.
What is unclear is whether the reduction in fees is equivalent to the separate DST being charged. Knowing Amazon, sellers will be worse off and they will take this opportunity to disguise an increase in their fees. Call me a cynic.
Seller_5VsVlvdiDnITx
To confirm, all fees will be reduced but then a separate DST will be imposed meaning the net change to UK based sellers is 0?
That's not how I read it. Where in Amazon's article does it say they will reduce the fees? How will they do that to PPC for example?
Seller_0msMReDTskp1Y
In the email I received they say:
"Starting on October 1, we’ll reduce these fees [selling on Amazon fees] and account for this cost by introducing a stand-alone digital services fee."
As Disenchanted_Seller says above though, they don't say it will work out to be cost neutral for sellers.
Seller_ZJhFeE3tNKzfh
"Where in Amazon's article does it say they will reduce the fees?"
Its in the second paragraph - "Starting on October 1, we’ll reduce these fees and account for this cost by introducing a stand-alone digital services fee." Nowhere do they actually mention PPC, and it was never applied as far I'm aware to PPC.
Seller_QuM1AZgzfU9x4
They haven't said outright what they'll be reducing the referral fee to, but in the example they have removed the .3% that was added previously and used the original 15% referral fee. If they do anything worse now then i expect uproar given it is their own example.
In their example it's a 5p saving on the referral fee, which is minimal. However the DST on FBA fees is new, so again in their example that's a new 7 p fee which means a net increase to sellers of 2p. Obviously there are a lot of variations of selling price and FBA fee so results may vary.
Seller_GmTPbk3yDYEry
Yeah they will remove the .3% on referral fee but what I am concerned is the DST on the FBA fee.
Reading the following part of the anouncement it seems that there is currectly a DST in FBA fee but I can't find how it's actually charged right now.
Am I missing something on this?
''Since 2021, we’ve accounted for DST by increasing Selling on Amazon fees in the UK, France, Italy and Spain, and Fulfilment by Amazon fees in the UK and France''
Seller_IC5dxZRZpcM4T
They also benefit from the DST being charged on all our revenues however they get the benefit of £25million GBP allowance tax fre...yippee an extra £500,000 charged to us that doesnt have to be paid to the tax man...
Personally i would like to have my portion of that 25mil allowance handed back to me.
