The EUVAT VATMOSS Campaign. Fundraising to attend a VITAL meeting

This blog has been left to its own devices since the main focus of campaigning shifted to the EU VAT Action Team website and related social media, but I’ll mirror this here, just to make sure everyone gets a chance to see it.

There’s been plenty going on over these past few months with the ongoing saga of EU digital VAT. Don’t believe anyone who tells you that Brussels shuts up shop for the summer while everyone heads for the beach. The emails and calls have been going back and forth as busily as ever.

We now have a chance to convince the EU that they must take decisive action to put a stop to the damage these regulations are going, at the EU Finance Ministers’ summit in Dublin, 7th – 9th September. As long as we can afford to send a representative to speak up on behalf of everyone so badly affected. The EU VAT Action Team has held off asking for money for as long as possible but now we need financial help.

Let me explain how we got this far…

With the ongoing and invaluable assistance of MEPs Vicky Ford (Con), Anneliese Dodds (Lab) and Catherine Bearder (Lib Dem), we’ve continued to make the case for reform and interim suspension of this legislation which is still proving unworkable and hugely damaging for the digital small business sector. It’s no exaggeration to say that it’s already killing the digital single market at the grass roots level.

Thanks to ongoing pressure from all the campaign’s supporters, through letters and calls, Deloitte have now been instructed to work with us and to accept our evidence as they prepare an impact assessment for the EU Commission.

Here in the UK we’ve been working with senior figures and VAT experts within the accountancy profession and other business organisations, as we continue to collect evidence of the hugely disproportionate costs of compliance, for the sake of paying trivial amounts to the tax man. We’re talking typically under £10. Yes, really.

We’ve also been collecting evidence of ongoing problems with the entire system. Such as small businesses in the UK being hounded directly by other countries’ tax offices over discrepancies which aren’t even their fault, of under £1, €1, and in one case, 5p. Yes, you read that right. The supposed agreement that such queries would be directed to HMRC simply isn’t holding.

Once again, letters and calls from all the campaign’s supporters to their MPs and other representatives have bolstered the EU VAT Action Team’s case. Feel free to continue writing!

We’ve reached the point where EU Commissioners Donato Raponi and Andrus Ansip are convinced this legislation needs a threshold to make the system workable. And while the details of that are worked out, we need an interim suspension for the smallest businesses who’ve been the hardest hit.

Now we need to convince all 28 EU Finance Ministries. To do that, we need to send a representative to Dublin. At our own expense. Welcome to modern participatory democracy – your voice will be heard as long as you can pay to play.

So we’ve set up a Just Giving page, with a target of £3000. If we don’t reach that in a month, every pledge will be refunded. And, obviously, we won’t be making the case for such desperately needed changes in Dublin.

Assuming we can reach that target (and passing it would be good!) the first priority will be meeting the Dublin trip’s costs. After that, we’ll refund the expenses the EU VAT Action Team have been covering out of their own pockets thus far.

For instance, my own tally for train fares and other direct costs is now approaching £500. That’s used up most of my own business travel and promotions budget, so if you’ve been wondering why you haven’t seen me at SFF conventions this year, there’s your answer.

(We’re not even trying to calculate the hundreds of hours and thousands of words we’ve spent on this, in meetings, writing letters, briefings and blogposts… And the rigmarole of setting up a bank account has been another saga in itself…)

Once those direct costs have been met, any surplus will be donated to Kiva, a non-profit microfinance company alleviating poverty in the developing world by enabling people to create their own opportunities, meeting their own communities’ needs.

We’ve already demonstrated that a lot of small voices protesting together can have a big impact. Now a lot of small donations could very quickly give us the sum we need to see this campaign achieve the changes to the legislation that all of us so desperately need.

Please give us whatever you can afford, and spread the word as far and as fast as possible.

Many thanks.

(For those of you who prefer to use PayPal, we are looking in to that option and will post an update as soon as that’s available. But as with setting up the bank account, getting a Donations button turns out to be an unexpectedly lengthy and complicated process.)

A tangible result from all the hard work by the EU VAT Action team, backed by thousands of you.

So here’s a tangible result from all the hard work by the EU VAT Action team, backed by the thousands of you who’ve filled in the survey, written to your MPs and MEPs, made constituency appointments, rebuked your professional associations, so on and so forth.

David Cameron is set to challenge European Commission president Jean-Claude Juncker over the impact of the new VAT levied on digital firms. The story’s also in the FT, though that’s behind a paywall online.

We did that. By which I mean ALL of us!

There’s still work to be done, of course. The latest EU VAT Action call to arms is here , and please do spread the word with all your friends and contacts across Europe and elsewhere overseas. Let them know this is the site to check for updates and information on who to write to and about what.

Now you must excuse me, as I need to prepare for meetings in London today and Brussels next week…

Clare Josa and I will be taking your concerns direct to the EU Commission and the European Parliament next week. On Tuesday evening Clare’s presenting our survey findings at a formal dinner on the barriers to the Digital Single Market, organised by the European Internet Forum, and attended by MEPs, their staff and the EU Commission / EU Council representatives.

On Wednesday morning, Vicky Ford MEP is hosting a breakfast meeting where we can directly brief MEPs, EU Commission Advisers and PayPal. We’re hoping for more MEP meetings later in the day, including meeting with the Dutch Labour MEPs, and hopefully a formal meeting with PayPal, where we will be pushing for them to release the customer’s VERIFIED country code for ALL transactions, as well as to allow 2+ rates of VAT per country, not just one.

No.10 Downing Street has also agreed to formally request meetings for us with Donato Raponi and Andrus Ansip later this month. Fingers crossed that this prompts something definite – we’ve had tentative arrangements thus far which keep getting postponed.

That’s the latest news! And hopefully explains why a lack of recent updates here doesn’t mean we weren’t still hard at work!

A busy and productive week for the EU VAT Action Campaign Team

For a SF and Fantasy novelist, I’m spending a remarkable amount of time being an activist at the moment. Well, it needs doing.

You’ll recall I met David Cameron, the UK Prime Minister to discuss the problems for small businesses created by the new EU digital VAT regulations on cross border sales? As a direct result of that meeting, the PM’s office set up a meeting for Clare Josa and me, on behalf of the EU VAT Action Team, with his special adviser Daniel Korski of the No.10 Policy Unit.

The full report – and actions you can now take to help everyone affected – is here.

To summarise, the UK Government now realises just what horrendous difficulties these new regulations have created. Countries creating wonderful MOSS systems to handle collecting the new taxes and paying them to each other is not the slightest use to the digital sellers whose businesses are now so horribly complicated by the need to locate and appropriately tax their customers at the initial point of sale.

They’ve also acknowledged how vital it will be to have end-user input into any discussions about any proposed technical or other implementation solutions. We’re already following up on that.

The people we need to convince now are the EU Commission and national finance ministries across Europe. Okay then…

EU VAT Action will be rolling out assorted calls to action with a particular focus on Europe. Something we particularly need is as many non-UK businesses as possible completing our survey. We’re currently working on making the survey available in other languages.

The first opportunity we have to make ourselves heard is a Twitter Q&A session with Andrus Ansip on Monday 23rd February. He’s the EU Commissioner for the Digital Single Market – which is of course being wrecked by all this. His blogpost is here and EU VAT Action will be offering some ideas for effective participation.

I’ve also met with Catherine Bearder MEP this week, and spent an extremely productive hour and a half going over all the key issues with her and getting her invaluable input on how best to get our voices heard in Europe. Subject to final confirmation, key EU VAT Action team players will be heading for Brussels in the week commencing 16th March.

So we’re definitely making progress. Keep backing us up and we’ll make more!

The EU VAT Action Campaign – recent and upcoming events

Last Monday saw the EU VAT Action team represented for the first time at the HMRC Working Group meeting to discuss implementation of the new VATMOSS system. You may rest assured that we highlighted the ongoing problems which microbusinesses are having with compliance, 3rd party platforms and the VATMOSS system itself, not to mention the widespread failures in European implementation.

Since he’s my constituency MP, I was also able to meet David Cameron last Friday, aiming to make sure he realises what the current problems are as well as their wider and longer term implications. It was a positive and constructive meeting, with every indication that the PM understands the seriousness and complexity of this issue.

While we are definitely making headway convincing the UK government, we still need to convince the finance ministers and key officials in other EU member states that this same trouble is heading their way. They just don’t know it yet because their own digital businesses don’t even know about the new regulations, still less about how impossible the law is to work with!

We need as many non-UK responses to the EU VAT Action survey as possible, as soon as possible.

Please spread the word. We’re already compiling country-specific reports from the data we do have – and the picture in the Netherlands for instance, is horrifying.

We want as many people as possible to contact the EU Commission’s Taxation Department with a personal complaint and also to submit comments to the OECD’s current consultation on implementing this sort of taxation.

Sounds daunting? We’re putting together clear guidance on how to go about it and on Thursday 12th February, we’ll be having a major online push to inspire as many people to act as possible.

On Wednesday 11th February I’ll be part of a Google Hangouts live online event at 7pm GMT organised by the The Alliance of Independent Authors to discuss the new regulations, VATMOSS and associated issues.

I’ll be particularly focusing on the campaign and the actions everyone can take to help. The more voices raised, the better the chances of being heard!

If you can’t make that particular time, you’ll be able to access a recording afterwards – check back for linkage in due course.

Making ourselves heard in Brussels!

Okay! The pressure we’ve been applying through EU VAT Action – along with every letter and email you have all been sending – is getting results.

We convinced two London MEPs to present our data and case studies to Donato Raponi, Head of VAT at the EU Commission.

As a result he’s agreed to meet representatives from our group, and others, within the next ten days.
More details as arrangements are finalised.

Meantime, help us keep up the pressure with those letters and emails to your MEPs, MPs, trade bodies, professional associations…

Let’s make our voices heard!

Full update from EU VAT Action

Talis Kimberley tackles Vince Cable and the Federation of Small Businesses.

So, the new legislation is here and proving to be the unworkable shambles we all knew it would be. You can find a full report on that over at the EU VAT Action website.

We’re keeping up the pressure, relaying all the evidence we gather to MPs, MEPs and the relevant EU Commission departments.

Talis Kimberley with her other hat on, as Talis Kimberley Fairbourn, Green Party parliamentary candidate for South Swindon* has done sterling work on everyone’s behalf!

“Yesterday I had the opportunity to ask a Senior Government Minister a question on small businesses, at an FSB event (I’m a member but haven’t engaged with them before). Turned out it was Vince Cable.

Now, not being shy, I sat there in the front middle seat right in front of him (Green Party badge on my shoulder as is my habit) and stuck up my hand when they asked for questions… got picked first, out of only about seven or eight questions for which there was time, so I’m glad I didn’t wait. Here’s what I asked:

‘Minister, you’ve spoken of working to create a good tax environment for businesses, and of tackling red tape.

What will you do to reinstate the much-needed threshold lost by online micro-businesses under the new, and chronically under-communicated VAT rules on where the tax is levied – rules which place an intolerable administrative burden on tiny sole traders and digital creative businesses, rules which other EU countries are implementing unevenly and which countries beyond the EU are largely ignoring as unenforceable, further disadvantaging UK digital businesses, and making a nonsense of your stated intent to support online commerce and small businesses generally?’

His reply was largely along the lines that Britain is doing really well with online businesses, and that he’s not a tax expert. He did say he was going to Brussels ‘to see about this’, and I have contacted my local Green MEP Molly Scott Cato in case it’s appropriate for them to liaise, as she’s been involved in raising this in Brussels herself. The Minister concluded “VAT is a current problem whether you’re digital or not” to which I muttered that it hadn’t been a problem for many of us until this change… but without a right of reply as such, I sat and looked unimpressed at him, scribbling notes.

However, at the end of the session, he approached me at once and said ‘I’m aware that I didn’t answer your question, may I have your particulars?’ so I gave him my card… let’s see what happens. I’ll keep you posted.’

More news on that as we get it!

Please continue to do what you can – and don’t take the first reply you get to a letter as any kind of final answer. I got the standard brush-off/HMRC-cut-and-paste reply from my MEP Catherine Bearder – and was so annoyed I fired back a polite but no holds barred take down of their worthless reassurances. Since then she’s got back to me with a much more informed response plus a list of the actions she’s taking to get this issue investigated properly in Whitehall and in Brussels.

For any of you in London, MEP Syed Kamall is looking for case studies – actual examples of the problems people are having.

* I mention this in the interests of full disclosure. This isn’t a party political issue after all – Syed Kamall and Vicky Ford are both Conservative MEPs and Catherine Bearder’s a Lib Dem. Other folk report getting similarly better informed responses from Labour MPs and MEPs – when they’ve answered an initial brush off with hard facts and figures.

January 2015 – where we are and where we’re going

So here we are, with everyone fully back to work after the Christmas and New Year break. And how are things with the new VAT regime?

Well, here’s Cheryl Morgan of Wizard’s Tower Press explaining just how awkward and time-consuming the so-called simple solution of using 3rd party vendors can actually be in reality.

As well as costing us that hefty and non-negotiable slice of income for the privilege. Oh, and let’s not forget that revenues from those third party sites are paid through anything from a month to six weeks after the actual customer has made their purchase. Whereas direct sales mean direct income!

A lot of people remain unaware of all this – which is hardly their fault, given how badly communicating all this has been handled by HMRC. Something that’s making folk sit up and take notice is finding US sites they’ve been happily using are now barring sales to the EU completely.

If you come across someone thinking this is just a knee-jerk response along the lines of ‘no taxation without representation’, here’s a blogpost from Carolyn Jewel explaining how it is IMPOSSIBLE for her to continue selling ebooks anywhere in the EU through Nook.

So while some providers such as Bandcamp have made heroic, eleventh hour efforts to enable their users to comply, and HMRC have shifted their ground over issues such as customer location evidence, it’s still very much apparent that this legislation is fundamentally unfit for purpose.

Accordingly the EU VAT Action team have been discussing our new focus for this new year. You can read the full update here.

In summary – The 2015 campaign aims are:
Short-term: to obtain a fair and reasonable exemption threshold, to apply worldwide

Short-medium-term: to work with the key EU decision-makers to review this legislation from the ground up, reworking it to be practical, fair and reasonable, even for the smallest companies

Long-term: to work at a global level to ensure that the other countries who are bringing in similar place of supply VAT legislation learn from the experiences we are having in the EU and avoid repeating the same mistakes.

Sounds simple, eh? Well, in some ways it is. This is so demonstrably legislation that’s wholly unfit for purpose.

What will make all the difference to the EU VAT Action Team being heard is being able to show just how many people we are speaking for. The EU VAT Action website lists a whole lot of ways you can add your voice.

If we are to see meaningful change at an EU level, we need to have sustained campaigns in as many EU member states as possible. Please do all you can to spread the word to family, friends and colleagues across Europe.

Letters to the Editors – Let’s get this story into the newspapers!

We’ve had some useful coverage here and there, mainly in business pages, as well as seeing some unfortunately less well informed stories. Now that Christmas is over, let’s make a concerted effort to push this up the news agenda.

We’ve already made a start, thanks to Isabel Zinaburg, Rosie Slosek and Beth MumblesMummies talking to The Daily Mail this week – and whatever you may personally think of The Daily Mail, it has a massive readership and that’s the reach we need. Here’s the article.

Now let’s target the opinion pages. A few thousand letters on the same subject should get the editors’ attention as everyone comes back to work after Christmas. Let’s fill their inboxes over the weekend, to make them sit up and pay attention on Monday morning.

Don’t try to explain it all. These letters need to be short and focused; a couple or three paragraphs at most, and as an email, not an attachment. With enough people writing, the papers will get the full picture.

Concentrate on the most important aspects to you individually. Such as –

Disruption, even ruin, of your business plans for 2015.

Loss of revenue if you’re cutting digital products completely.

Loss of revenue if you’re abandoning direct sales and being forced into using 3rd party suppliers.

Make the point that it’s Amazon, Google and Apple who’ll benefit from that.

Additional costs if you’re paying for enhanced online payment solutions and/or accountancy services in order to comply.

What that means if your digital earnings make the difference between claiming benefits or not.

What that means if your margins are already so tight, this could very well put you out of business.

How the zero threshold means imposing an appalling burden on the smallest businesses, out of all proportion to their resources, and to the revenue that the scheme will bring in.

How late you found out about it all– and at such an impossible time of year for dealing with things like this.

Loss of hours of precious time with your family over the holiday season, as well as the stress of trying to tackle all this.

How late so many of the platforms vital to e-commerce found out about this, such as Bandcamp, Ravelry, Etsy.

How some platforms are trying to help and how others refuse to be forced into doing so.

How utterly lacking consultation and communication has been, with so many folk only finding out by accident, through social media.

How confusing and changeable HMRC’s advice has been.

How HMRC and Treasury, as well as the EU Commission, clearly have no idea how much small scale e-commerce goes on, never mind how it actually works.

What all this means for customers, as prices go up and choice goes down, especially with US sellers increasingly opting to block sales to the entire EU just to avoid this mess.

Remember, just pick a couple of these points. Make your letter passionate and personal!

Letters for publication in The Guardian should be sent to guardian.letters@theguardian.com letters for publication in The Observer should be sent to observer.letters@observer.co.uk

They say – “We do not publish letters where only an email address is supplied; please include a full postal address, a reference to the article and a daytime telephone number. We may edit letters. Submission and publication of all letters is subject to our terms and conditions.”

(Those T&Cs are essentially you’re granting them a license to use the letter in print, online etc, edited if they wish. Plus don’t be obscene or defamatory or infringe intellectual property rights.)

Letters to the Daily Telegraph, Sunday Telegraph and Telegraph.co.uk should be sent to dtletters@telegraph.co.uk (Daily Telegraph) or stletters@telegraph.co.uk (Sunday Telegraph). Please include name, address, and work and home telephone numbers.

Daily Mail – Send letters to the Editor at letters@dailymail.co.uk They don’t stipulate adding your name, postal address and phone number but since every other paper does, I’d recommend doing so.
You might like to start by thanking Louise Eccles for her story raising awareness about this, since you feel so strongly that the public really need to know what’s going on 

The Independent – E-mail (no attachments), giving postal address and telephone number, to letters@independent.co.uk

You’ll notice I haven’t included The Times, The Sunday Times or The Financial Times. That’s because they’re all behind pay walls online, so that information’s not immediately accessible to me, and similarly any letters that got published wouldn’t be linkable for social media purposes.

That said, if you are an online subscriber, please do write to any or all of these papers. If you can help by posting their contact details in a comment, by all means do so.

A little movement from HMRC to potentially help some businesses. So now we press for more.

Here’s the latest from EU VAT Action . The key development is this –

Basically HMRC has agreed that, for those in the UK below the VAT threshold, you can use the PayPal (or equivalent) country code as your evidence for proof of place of supply until the end of June.This is an enormous achievement, due to the thousands of people who have taken action in this campaign, so thank you!

It’s not perfect. It doesn’t fix the rest of the problems. To be honest (see below) HMRC themselves can’t fix most of those. But it WILL allow more people to keep trading, while we all negotiate a reworking of the rules and a sensible threshold.

Here’s the text:
https://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumers

So this is a move by HMRC which will potentially help some of those digital businesses which might otherwise have to close on 31st December. Because HMRC have finally recognised how massively wrong the assumptions underpinning this legislation have been, and what a horrendous mess they now face. That much is progress.

That said, this tweak is by no means a solution. If it’s meaningless in your particular context, write and say so. Make it quite clear that tinkering around the edges isn’t going to make this headache go away.

EU VAT Action will absolutely continue campaigning until a workable system is devised with thresholds that recognise the levels of turnover below which the administrative burdens of compliance are impossible for a small trader and where the costs for the tax authorities outstrip any potential revenues.

So , please keep on sending your letters and emails to convince the powers that be, in Whitehall and Brussels, that review and revision of this legislation is essential, from the ground up. Every time you see a news story about the UK or EU economy, use that as a prompt for a fresh round of protests!

This past week, we’ve seen newspaper and BBC stories about worse than expected UK deficit figures. So why not contact George Osborne and point out that putting tens of thousands of small traders out of work really isn’t going to help with this, never mind all those rest of the world sellers whose response to VATMOSS is simply to cut off all digital commerce with the UK and EU.

Any UK citizen can do that in his capacity as Chancellor by e-mailing public.enquiries@hm-treasury.gov.uk, telephoning 020 7270 5000 or writing to The Correspondence & Enquiry Unit, HM Treasury, 1 Horse Guards Road, London, SW1A 2HQ.

According to Environment Secretary Liz Truss, the countryside is to drive UK startups with superfast internet through 2015. I really do think she deserves a flurry of letters pointing out precisely how VATMOSS dooms that hope to failure.

To lobby her as Secretary of State for Environment, Food and Rural Affairs, please contact Defra directly. Write to: Defra, Nobel House, 17 Smith Square, London, SW1P 3JR Email: defra.helpline@defra.gsi.gov.uk Telephone: 0345 9 33 55 77

We have to create a climate for change as soon as possible in 2015

The latest update from EU VAT Action is here.

It’s long, it’s detailed and it’s important for several reasons which I’ll attempt to summarise here since I know how busy everyone is at the moment. (Then I’ll go and try to salvage something from the wreckage of my own pre-Christmas To Do List…)

We are being heard in the UK. We are finally getting the message through. If that doesn’t seem like much, because there’s no sign of a suspension or anything similar so far, do please take a moment to look back and see how far we’ve come. A month ago HMRC and Treasury were convinced that everything would be fine, no problems at all, so the little people really should stop making such a silly fuss, comply or expect to be fined. That’s where we were in November.

There is no time or scope for substantive changes before January 1st. If this wasn’t all happening over Christmas, if we’d a year or even six months to campaign… well, if wishes were horses, beggars would ride. We are where we are, and yes, we are all as angry about this as you are.

What we can now see are several opportunities for arguing our case in early 2015, here and in Brussels. And the public outcry so far means that EU VAT Action is now assured of a seat at the table for those meetings. Yes, really.

The more outcry there is, here and in Europe, the more weight our words will carry. The more leverage we’ll have. Will we succeed? Who knows but we’re giving it our very, very best shot.

You can help by giving us evidence. If you haven’t already done so, please complete the survey.

Tell as many people about the survey as you can. Especially any contacts you have in Europe.

Write letters to your MEPs and explicitly ask them to lobby Pierre Moscovici for reform on your behalf. Point out that the simplest and easiest solution is a turnover threshold.

All emails should be cc to
Pierre Moscovici – pierre.moscovici@ec.europa.eu
Andrus Ansip – CAB-ANSIP-WEB@ec.europa.eu
Donato Raponi – Donato.Raponi@ec.europa.eu

Use their own words against them.
Mention this OECD report of 18th January, especially Page 18, para 17

Jurisdictions should aim to implement a registration-based collection mechanism for business-to-consumer supplies of services and intangibles by non-resident suppliers, without creating compliance and administrative burdens that are disproportionate to the revenues involved or to the objective of achieving neutrality between domestic and foreign suppliers

Rip holes in Andrus Ansip’s Blog on #EUVAT
Point out how all this makes a mockery of Commission President Juncker’s supposed support for the Digital Single Market.

Make this personal and back that up with hard facts and figures.
If you’re being put out of business, say so. Say what this means by way of lost income and lost investment of time and money.
If you’re only able to carry on with an appalling new administrative burden, say so, and spell out exactly what that’s costing you in additional paid-for services and time.
If your only option is using 3rd party platforms, say so, and let them know what that means in lost revenue.
If you’re moving your digital business base of opeations out of the EU, say so – and point out how easy that is to do with digital services.

Write another letter at the end of January, saying how your month has gone. Another at the end of February, if we haven’t seen any meaningful change by then.

Write to your MPs and now it’s time to make this political.
Make it plain that you expect them to take action to support the smallest business sector.
Copy that letter to the head of the local political party who’s selected and endorsed your MP.
There’s an election coming. Point out how the only people who’ll make political capital out of this will be UKIP and other extremists.

The more voices, the better our chances of being heard.