Changes to the UK’s cross-border value added tax rules that coincided with Britain’s departure from the EU single market at the start of the year have created “chaos” for direct mail orders, resulting in refusals to trade, delayed orders and opportunities for fraud.
On January 1 the UK implemented a change in the rules for foreign mail-order sellers, insisting they register for UK VAT for any items sold to UK customers, collect the correct sales tax on behalf of the government and pay the money to HM Revenue & Customs.
The changes were not directly linked to Brexit because the UK could have applied its existing rules for non-EU mail orders, which stipulate that VAT is added as goods enter the UK. But officials believed they did not have the capacity to police such a move so decided to force all foreign sellers to register for UK VAT if they want to sell to British consumers.
The difficulties in mailing orders across borders will be compounded, say…
