One of the things I've learned running my own business: Nobody Tells You Things.

I always thought that information about things changing that would affect a shop or business would be coming to said shops and businesses. Say, for instance, that there's a change in VAT rate - the tax you have to charge for every sale.

If you have a business in Germany, you're listed and registered. At the very least, your home town has your registration as a business. You might also be registered in some other institutions or thingummies, but let's leave that aside - one registration, which is in your town and thus an official state registration, that's enough.

So in theory, since you are registered and the state should sort of have an interest in having you comply with rules and regulations... I'd have expected some letter or email or notice about that change in VAT rules to come to each business. Not necessarily a long explanation or precise instructions, mind. Just something like a heads-up, as in "there'll be a change, please check if that applies to your business and inform yourself".

Just in case you're also in the Fluffy Bunny Wonderland of Imagination and Incredible Optimism, like I was about this once upon a time, let me burst your bubble: This is not so. Nobody official from the town, or from the state, or from the EU, or from any other stately place, ever tells you anything about upcoming rules or changes. Ever. EVER. You have to miraculously find out about things yourself... or fail to do so, and then maybe eventually fail to comply with rules. The most you can hope for then is an admonishment if your failure to comply comes out somehow, and maybe you'll have to pay a fine then, too.

The long-time readers of you will remember the issue with VAT-MOSS (or VAT-MESS) some 5 years back, when VAT rules for digital goods sales across borders were changed, and caught a lot of vendors unaware. Back then, already, it was hinted that similar rules should be introduced for physical goods as well. This is now going to happen; it was planned to start in January 2021, but has been postponed to July because of the pandemic. I accidentally learned about that this morning... which meant I spent half the morning reading up on stuff to find out what I'll have to do come July.

The good news is: looks like I'll have to do exactly... nothing. My business, and thus my export volume, is small enough to fall under the annual export threshold, which, thank goodness, has been set into place right from the start (as opposed to when the digital sales VAT changed). As a side effect, I've also found out that a similar threshold has been put into place for sales of digital goods, which is fantastic as I'll be able to sell digital instructions and knitting patterns from my shop again. (That threshold introduction happened at sometime back between 2015 and now, and I totally missed it.)

So. Phew. A burst of adrenaline, and then good news - that's an okay outcome of this. And I confess, should you now all conspire to order so many things outside of Germany but within the EU to lift me over the threshold, I'd be totally cool to register for the One-Stop-Shop for my taxes and do the fancy changes to the shop system that would be necessary. (If you want to know, it would mean to look up the tax rates for each of the 27 member states and what they apply to, as books and other printed goods are sometimes taxed with a reduced rate and sometimes not at all, then enter those taxes in the shop system accordingly for each country. Then test all that to make sure it functions properly. That is probably a workday, if it's going badly, more.)

After this little intermezzo... I can now tackle my overly long list of things again. Hooray!

While the sun is shining outside and the flowers are getting ready for spring bloom, other stuff is blooming, too - but not in a nice way, unfortunately.

One of the issues is, again, harassment at conventions. I believe the current wave of discussion was sparked by Mark Oshiro's post about how he was treated when he was Guest of Honor at ConQuesT 46. Jim Hines has a post about the importance of not only having a harassment policy at a con, but also enforcing it, with more links to issues. Rachel Caine, in the wake of this, is declaring to act accordingly in the future, and I wouldn't be surprised if more will join her. We can hope for changes, right?

Another issue, of a less geeky nature, is the nightmare of the EU VAT madness still going on. It is having an impact not only on the tiny firms, though - Ghost (a UK digital platform) will be closing down its business in the UK and reincorporate in Singapore to avoid the VATMESS. Advice and guidance for small businesses has been, and still is, conflicting - it's not gotten any better. As far as I know, the plan to expand this madness to all goods, including physical ones, is still alive (though it has not been pushed through this last January, as was planned previously) even though the problems with the current digital tax have not been solved.

Even more bad news (not an issue, however) - Peter Lustig died yesterday, aged 78 (link to a German page). He was one of my childhood's TV stars, explaining things, researching and tinkering, first in the TV show "Löwenzahn" (dandelion) and later in a show called "Mittendrin" (in the middle/in the thick of things) (though I'd almost outgrown the format by then).

Huh. Sometimes I wonder how bad things can get, for us as a society or as a culture, and for humankind overall, especially looking at how we ruin our environment, and how hard it is to keep one's footprint small. However, ignoring problems or bad things usually tends to make them worse, not better...

I promise more upbeat things on the blog tomorrow...

I promised yesterday to write something about the issues I have with the survey.

I'm running late on my prep for the Nadelkunst fair, though, and I have to leave tomorrow to set up the stall - which means I have to pack today. So, as much as it would have delighted me to write a special post about the survey questions just for you, with a lot of lovely, lovely snark and links and weird references, I'm out of time for that, and the thing is too important for me to put it on hold until somewhen next week.

So you're not getting a blog post written specifically about this. Instead, I'll share with you the letter I wrote about the survey questions, sent off to the contact address listed with the survey (at least they had that!). I really hope that it will get read, and that it might do a little bit to help improve the situation.


Dear Sir or Madam,

I am one of the small business owners that has been hit by the changes in EU VAT law, and with the proposed extensions of these changes to all goods and services, I am very much afraid for the future of my business. I am running a tiny business with very specialised goods and services, and some of them used to be digital. I was also planning to do more digital content in the future, but these plans have been put on hold due to the VAT rules change.


The very specialised nature of my business, however, means that I am very reliant on getting customers from outside of Germany, which count for up to 60% of my turnover in the online shop. The size of my business means that I cannot invest in expensive shop software, legal counselling, an IT specialist or a tax assistant, and this effectively makes it impossible for me to sell digital content under the new rules. Similar problems would occur with an extension of the new rules to any goods and services, and would probably force me to shut it down entirely.

Hence I was very happy to hear about your survey for the open public consultation. After looking at the survey, however, I am even more concerned. Many of the questions you pose are hard to understand or unclear in their intent; the whole survey is written in a way and in a language that makes it necessary to already be very well informed about the VAT changes, both extant and planned. If the questionnaire were really intended to take in public opinion, the language alone would make that about impossible. The questionnaire gets even less inviting to be filled by the fact that there is no information on whether any of the fields are compulsory or not, and then asking for a name and contact data.

The questionnaire is also not stating anything about how the data will be used, by whom and for how long it will be stored, and whether it will be treated as confidential. If you were running a shop in Germany, this would be enough to serve you a notice for insufficient information about data security and privacy (incurring costs, of course, of at least a few hundred Euro).

There are even more issues in regard to the individual questions or wordings.

This already starts with the introductory texts.
"In parallel, a Mini One Stop Shop has been implemented to reduce the costs and administrative burdens for businesses concerned."


This sounds like the new legislation were entirely introduced to reduce burdens that were already extant for a long while. This, however, is not true. In many cases, the new system and the MOSS have not reduced the costs and burdens, but added to them considerably, even driving single entrepreneurs out of business entirely.

"The open public consultation will seek the views of business, the public and representative organisations [...]"
As stated above, it is a wonderful thing that everybody, including the public, is invited to have their say here. However, the explanations and the survey both are not accessible enough for the public - they are hard enough to understand even for educated people who are already familiar with the new rules for digital VAT.

Qu. 2 & 3 - Why are you asking for a name and email address? Is there any need for this? What will you do with this information? How will it be stored, where, and for how long? Every business has to inform their customers about how their personal data will be handled, and any such information is missing completely here.

Additionally, since you will be asking questions about how the changes have been handled by businesses, this is not conducive to getting straight, honest answers, since one might risk being lined up for an audit or being fined for non-compliance.

Qu. 4: If you are asking after the head office, shouldn't that be a BO question? Or should it be place of residence?

Qu. 5: There is no possibility to later change one's mind?

Qu. 11: Shouldn't that be a BO question? I also find unclear what you want to know here.

Qu. 12&13: You are asking about supplies not reported under MOSS. What about the extra burden added by registering and using MOSS? What about the burdens of extra work to try and comply with the new rules, only to spend many hours to file VAT to another EU country of under 1 €?

(By the way, the German wording implies that the question only asks after the calculation of the VAT of the other country, not the calculation and actual administration/payment to said country.)

Qu. 14 and other "please rate the difficulty" - the term "representing the most difficult" sounds like I am supposed to rate the individual answers from 1 to 5 in a hierarchy - which is technically not even possible in case all of them, including "other" applies, since there are 6 answers here. Or did you mean "scale of 1-5 with 1 representing not very difficult and 5 extremely difficult"?

Qu. 21: This is where having to state a name and email (or feeling that one has to, since there is no explanation on whether it's a can or must) will probably skew results. I also have a hard time understanding why "You also supply goods" would be a reason not to use the MOSS - as far as I understood, if I'd be selling digital goods and non-digital ones I would have to register for MOSS for the digital ones even while well underneath a threshold for registration in another country with my goods turnover. Or is that wrong?

Qu. 25: Does this question ask for my agreement with the objective to minimise burdens (including, or especially including, the burdens that have newly been added by the VAT rules in effect since January 2015)? Or for my agreement with the changes in VAT rules that are planned for the future, which might, according to the text in the intro, also be seen as "minimising burdens" even though it adds complications for small businesses?

Qu. 26: Are you asking for whether I would want all businesses to charge the same VAT rate throughout Europe? Or the same VAT rate when selling to one specific country? Or for my agreement that whatever the rule, there should be no exemption at all? What about an excemption not based on the price of one single small consignment, but based on the turnover of the company that is selling?

Qu. 27: If I answer with "I agree" to this question, it could be equally interpreted as my agreement to: a) the MOSS needs to be improved; b) the current Digital VAT rules need to be expanded to physical goods, c) a single registration and payment mechanism has to be set up so that registration when exceeding the turnover limits for VAT registration in another country can happen at the MOSS.

Qu. 28: It is difficult enough to find out, in some cases, what VAT to apply under domestic rules. How is it supposed to be technically possible to tax according to the customer's country? Most of the companies do not have their own law department that could spend a lot of time looking into this. There is not even an official reference list stating all the different tax percentages of VAT on the EU website (the list that is there is full of disclaimers that it may be wrong, or not up-to-date, and thus cannot be used as a legal basis for taxing). Am I supposed to learn Hungarian to find out what has to be taxed at which level in case some Hungarian customer orders a 5 € item from me? How is shop software going to handle the fact that an ebook in one country might not use the reduced tax level, but the higher one, and maybe super-reduced in a third country?

Qu. 29: This question is hard to answer without more context. It sounds as if the current rules would allow every single country in the EU that one has sold something to, no matter how small, would be entitled to do an audit. Now, apart from hoping I'd never have to deal with an audit in, say, French (which I can understand a little, and speak a little, but far removed from anything suitable to do Legalese with) - how is that supposed to function? How can a French auditor deal with my all-German book-keeping documents? Or do the rules mean that I will have to do multilingual book-keeping from now on? And will somebody from France come over to me in Germany to do the audit? Or am I supposed to ship copies of all my documents to France? Or go to France myself? Who will pay the expenses for this? What about the data security when my documents are sent somewhere out of the country? Whose rules about customer data confidentiality would then apply? German rules? French rules? An entirely different third set of rules?

Qu. 30: Again - how is this supposed to be enforced? If the EU hasn't managed to even tell their own citizens and businesses in time, and clearly enough, about the changes in VAT rules (see awareness level estimates in the full report available at http://euvataction.org/report/), how are you going to communicate to the myriad of kitchen-table entrepreneurs and microbusinesses in the US, Australia, New Zealand, the Philippines, South America, ... that they are now supposed to follow different, much more complicated rules and pay taxes to a multitude of different countries within the EU? The results, should it be possible to actually tell them about it to raise levels of awareness to somewhere of, say, 50%, will either be that a) these microbusinesses will ignore the new rules or b) stop selling to customers within the EU. Already businesses in the US have stopped providing services such as software updates to EU customers - even to EU businesses because making a distinction there would be too much of a paperwork/shop software change burden.


Qu. 31/32: This is unclear on whether the threshold would apply to a certain amount per parcel/consignment/sale, per turnover of a business, or per sales made in a specific country. (Well, Qu. 32 makes it clear it probably does not mean amount per sale.) It's impossible to properly answer a question on the appropriate level of a threshold without knowing what the threshold will be based on!

Qu. 33: Does "easier management for tax administrations" mean easier management of tax issues for businesses, or are you actually asking businesses and members of the public whether they think a threshold would make internal administration in the tax departments of the individual member states easier?

Qu. 34: How is "uncertainty on whether a business will exceed the annual threshold" a risk of cross-border thresholds? Whenever there is a threshold, there's always a risk that if a business does well, it might be crossed. However, usually this is considered a good thing as it means business growth. This question sounds as if what lies beyond that threshold is so hard to handle and so difficult to navigate that a business would be happy to curtail its own growth just to keep beneath it. Which is, in fact, a very fitting description of the actual situation for digital micro-businesses right now, only that there is no threshold below which they could still prosper.


Qu. 35: Again, two questions rolled into one. Do I agree that any threshold needs to be harmonised? Do I agree that any threshold should apply to both goods and services? Also: any threshold in connection with VAT? Or also any internal threshold in connection with commerce and business within a member state? How about the thresholds for complete VAT exemption for supermicrobusinesses like it exists in Germany? What about differences in the size and annual turnover from member state to member state, are these going to be taken into account, or is every country now supposed to work the same way, instantly?


Qu. 36: Thank you for including an open text box in the survey so that survey takers can tell you what they actually think. This is, for me, the only thing redeeming the whole survey, and I do hope that you will get a lot of input through this text box.


I was very excited to hear about a survey that would allow micro-business owners like myself and my customers to chime in and help find a better way for the VAT issue in the EU. I do realise that VAT is an important income for every single state, and that the EU wishes to spread the earnings fairly. But this survey has questions that can be interpreted in many different ways, and you might thus get answers that were the actual opposite of what the person filling out the questionnaire actually wanted to say.

So now I am very deeply concerned about this survey. As so many of the questions are so unclear or so open to interpretation, it does not matter what the actual opinion and actual answers of those filling out the survey are – the survey can serve as a carte blanche for any end result desired.

I still hope that there will be instant action to relieve the incredible burden on microbusinesses that are caused by the new EU VAT rules, and that there will be no extension on physical goods and non-digital services until there are workable solutions and sensible thresholds for the EU VAT. I still hope that there is a future for my business – but the way this survey is built up and worded has dampened my hopes considerably.

Regards,

Katrin Kania

I'm sorry if the title shocked you - but I am really afraid of the future for my business at the moment. Not because I don't love what I do anymore, or am running out of ideas, or projects, quite the opposite. It's because of the planned changes in the EU legislation regarding taxation for businesses.

If you've been reading along for a while, or have read yesterday's blog post, you will know about the changes in the EU VAT for digital goods, and the mess it brought along. (If you have no clue what I'm talking about now, go back to yesterday's post to have VAT and EU VAT explained, or go straight to the EU VAT Action Group's info page. Or TL;DR: We sellers have to cope with a mess of new rules to sell outside our home country since January 2015, and these rules are literally impossible to comply with.)


So. I can tell you, by now, that I have been losing sales on the Pirate Robert hat because I'm offering it as a printed pattern and not as a pdf file. A lot of knitters are annoyed that they're not able to just download it. I can understand this, even though (obviously) I'm not thrilled about it.

It gets worse, though - much worse. An extension to all goods and services is on the slate for 2016. All goods and services. So if you'd like to buy a spindle in the US? May well happen that the seller refuses to sell to you, because of the VAT paperwork that would entail. Things like this are already happening - sellers are blocking anyone from the EU and refuse to sell to them. (Even EU businesses though there are different rules for this, and they could sell to them no problem.)

This extension might mean the end of my business, too. I have built up what I am doing, and developed the products I am selling, for eleven years now. My business is not making a lot of money, but it's enough to let me keep flying, and that's all I ask for.

http://bksmith.deviantart.com/art/Serenity-132101392

 
A lot of the sales I make are in other EU countries, so this legislation would hit me really hard, right in the face. I could probably cope with that. I'm not sure I could cope with the additional anxiety, though. Running a business as a single entrepreneur always means a lot of bureaucracy, and always means you can slip up and mess something up, or not be aware of a change only to find out a year or two later you have not complied because you freaking did not know about it. You are only a single person, after all, and you want to spend most of your time and energy on developing and promoting your business, and not jumping red tape.

Now, I'm a person who worries about stuff, especially about getting stuff wrong. Every year around tax time, I have a few weeks of feeling ultra stressed, having to file about six individual report thingies, which all have to be correct. Every time I put something new up in the shop I triple-check to make sure it includes the correct VAT. Every time I find out about a change of rules and regs, I spend a few hours making sure I'm compliant, and several more days to weeks feeling stressed about the fact I might have missed something. And there are really stupid changes, too - such as having to label the button for "buy now" something different (equivalent to "yes, I do agree I will have to pay for the order if I press this"). There's newsletters you can get to try and keep up to date, and every single instance of these letters begins with some news on how you can be served notice for this typo or that wording or that attempt to explain how your shop works to your customers. (Very, very helpful. Thank you so much. Not.)


So. I am wishing very, very hard for this plan of extension to all goods to go away, and since that was never enough in this world, I'm also doing what I can. I have written to Members of the EU Parliament, and politicians here, and donated to the EU VAT Action Group, and tried to spread the word. But the more people that do things to make the EU realise we need help, and we need it now, the better.

And here's where I ask you to please help.  The EU Commission is running a survey with a long title about the EU VAT. The aim of this survey is said to see how the current system is working, more or less.


The survey is a very, very good thing, because it means there is awareness of our problem (our meaning small businesses like mine).

Unfortunately, it is also all written in Legalese, and I find it complicated to understand in both English and German. Some of the questions are highly confusing, in some cases even misleading, or open to interpretation. In short, the whole survey feels very weird to me. (I'll do a separate post about that, probably tomorrow.) In several of the questions you are asked whether you agree to blah and chatter, and it is impossible to discern whether your "I agree" would mean you agree to blah, or to chatter, or to both of them, or to the general idea behind both blah and chatter - so your answer would be open to interpretation. Also, Legalese. Never good in a survey that's supposed to be inclusive...


Still, the fact that we have this survey is a very, very good thing. It looks daunting, but it is actually rather easy to work with.

The survey does not have any field that is compulsory. You do not have to fill out or answer anything (which includes the fields for your name and email addy at the top) in that survey. So please don't be scared off by all the legalese, or the length of it.

If you would like to help my business, and countless others like it, you can do so easily with help of that survey.

Click the link to open up the survey (it opens in a new window).
Ignore all questions that you don't understand, or don't feel comfortable answering. Just leave them blank.
It would be nice if you could answer questions 1, 4, and 15 to help those evaluate the survey get an idea of where you are from, and for statistics about how many people are affected by the new rules, especially as customers.

Now for the important bit. Go down to the box. If you have taken the time to read the survey and you found any of the questions were hard to understand, or if you felt any of the questions was skewed, or open to interpretation, or uncomfortable - tell them so in the box.
If you only heard about the EU VAT rules today in my blog, tell them you only learned about it today even though it's been active for nine months.
If the new legislation has impacted you in any way whatsoever, tell them so in the box. In any way. This could mean a business not selling pdf patterns to you anymore (I have switched to print, for instance), geo-blocking you, or having to cope with lots and lots of clicks in checkout. If you feel concerned about all your customer data being kept for 10 years (one of the new rules), tell them so.
If you feel there has been way too little education about the new rules to businesses, customers, or both, tell them so.


If you agree that it will be desastrous for micro-businesses that are suffering already to wait for several more YEARS until the legislation is amended and a threshold is introduced, tell them so. Small businesses need a cross-border digital sales threshold, below which domestic VAT rules will apply, and a 'soft landing' threshold above that, for the next phase of business growth.

If you feel concerned about a huge impact on your abilities to buy things from smaller vendors from out of your country when this goes into effect for all goods and services (and I think you should be concerned about that), please tell them so! (Personally, to me, this would be the most important thing in the survey that you could do.)

Please help me save my business, and help save countless others (most of which are probably not even aware of the trouble coming up). Fill out the survey. Spread the word. Link posts about the EU VAT. Tweet about it. Tell your facebook friends. Tell your real friends. Tell any politician you might know. Feel free to comment here, too, if you have any questions or would just like to vent about these quixotic laws that completely ignore the reality of small traders. The more this is spoken about, the more voices that are raised, the better. We small traders need your help, and we need it now, before the brown stuff really, really hits the fan.

If you've been reading along for a while, you will have read about the EU VAT on my blog. If you have no clue what I'm talking about now, let me give you the TL;DR version of the whole thing.

When a business sells something to a customer, the amount paid includes a certain tax that we'll call the VAT (for Value Added Tax. The German word for it is Mehrwertsteuer*, and every EU country has their own term for it, but it functions just the same everywhere). The business then sends that tax money on to the state, who grins and takes it. You must pay VAT if your business is over a certain threshold of turnover (that is the money taken in and spent added up - so if you spend 20 € and get 20 €, your turnover is 40 €. Your winnings, however, is zero, so high turnover does not necessarily mean you're getting rich.); the threshold varies from country to country.

VAT is everywhere and it's on everything you buy, every day, everywhere. It thus shouldn't surprise you that the income from VAT makes for a huge chunk of the income that any EU country gets.** This tax is thus very important to any EU country. Accordingly, they feel rather strongly about their money, and they will afford you little slack for transgressions.

How much VAT is charged, however, and which rates apply to what kinds of goods, differs from country to country and is not always straightforward, or easy to understand. For instance, when I sell a book, I have to charge 7% VAT instead of 19%, because books have the reduced German VAT. When I get paid my royalty fees from my publishing house, however, they are charged at 19% VAT even though all that money is coming from selling books charged at 7% VAT!

Are you still with me? (I hope so!) Here's where it gets interesting. Each member state of the EU has this system, with their own issues and confusions about what gets charged what, and they all have different rates of VAT - as many as five rates in a single country, and 75 rates altogether in the 28 countries. There's a list online (German version here), so if you like numbers or would like to see how complicated the framework of all this is, go take a look. I'll wait here. Make sure you scroll down to at least page four to get an impression. Heck, just scroll through the whole thing once, you don't even need to read it to see how frazzled this all is.

Here's where it gets interesting. The rates. When you live in a country that charges high VAT, your customer effectively pays more money to you, so your prices have to be higher than they would need to be in a low-VAT country. That is the reason Amazon has its business centre in Luxembourg - lowest rate in the EU.

Essentially, the big players go where they don't pay as much VAT, helping them outprice the competition. This has two effects: firstly, the competition, especially local and small businesses, can't match that pricing and suffer, or have to fold. Secondly, the low-VAT state gets a lot of VAT money even though most of the goods are shipped out of the country.

Remember how I said that VAT is not where countries have a relaxed attitude?

So. There's money to be had, and the EU Commission realised that there might be some skew to the system. Enter a plan to make it all different. What if the business has to pay the VAT to the country they ship the goods to? Wouldn't that be fairer all around? The company pays VAT according to where they make their turnover, and the corresponding country gets the money. The customer does not notice any changes and always pays the same VAT rates at their home country rules (which few customers probably ever thought about, or care about).

Sounds good? Well. That's what the EU Commission thought, and they wrote a new law, and that would start with applying the new system (pay VAT based on the buyer's country) to digital goods and services - mp3s, ebooks, software, games, anything that is digital and downloaded via the 'Net. This rule came into force in January 2015.

Since then, countless small businesses have closed down, and many more startup plans have been laid into a shallow grave. Why? The rules are in effect for everyone, from the first penny or cent of turnover you have.

If I would sell a 1€ knitting pattern on pdf to one person in the UK in 2015, I'd be forced to register for VAT in the UK, do the VAT accounting (probably four times, once for every quarter of the year) and send the money over (which includes paying for any bank charges for currency conversion). For one single euro. Can you believe that? There's a threshold under which you have to pay no VAT in most countries for a reason, but there is no threshold at all for the new EU VAT. There's a thing called the Mini One-Stop Shop for small businesses where you can register once for all the EU countries, and which is supposed to make things easier, but it's not making it much easier, and it's not working really reliably yet. (This legislation is in effect since January, by the way. It's not working reliably yet, about 9 months in. That's enough time to make a human baby.)

So many businesses folded because they could not invest the time and money to make sure they can work with the new system, or they did not want to face this wall of bureaucracy that can bite you in the ass, hard, if you mess up. (That thing about no slack being cut.)

Now, for those who did not want to throw in the towel yet, the rules are so hard to follow that even the Big Players have huge trouble implementing it, and they have teams of software people and accounting people and law people. Small, single entrepreneurs? This regulation adds so much paperwork, consumes so much time, and costs so much money that trying to comply can make a business fold. (You can find out more about the impact, and the problems, here.)

Oh, and by the way, this is in effect world-wide. So if an US company (not in the EU) sells me a knitting pattern download, they have to charge me 19% VAT and send that VAT over to good ol' Germany, who will grin and take it.

That's not all, though. An extension to all goods and services is on the slate for 2016. All goods and services. So if you'd like to buy a spindle in the US? May well happen that the seller refuses to sell to you, because of the VAT paperwork that would entail. Things like this are already happening - sellers are blocking anyone from the EU and refuse to sell to them. (Even EU businesses though there are different rules for this, and they could sell to them no problem.)

This is, as you will hopefully agree, a Bad Thing - for many, many businesses as small as my own, or also quite a bit larger. It's impossible to comply with the legislation as it stands at the moment - but there's been a lot of complaints, and the EU commission is finally aware of the issues, and willing to do something against it, so there is still hope that this mess may be resolved.

And you can help - though in the interest of not boring you to tears with an insanely long blog post that nobody ever wants to read to the end, I'll tell you how tomorrow...



*Which lends itself wonderfully to being called "Märchensteuer", literally "fairy tale tax". The one little bit of humour this whole mess affords me is thinking "fairy tale tax" every time I say or write MwSt, or VAT. Also helps hoping for a fairy-tale-like happy ending.


** I had a phone call on Friday about this topic, and I think I remember being told "the biggest", but I don't want to misquote.

We all make mistakes, small ones, big ones, some that are easily fixed and some that haunt us for ages. (Sometimes small, easily fixed ones can still be of the haunting sort, though.) Mistakes are not nice to make, but they are a part of life, and every one of them is an opportunity to learn, and do better next time.

Mistakes are also an opportunity to think things over, and maybe alter them to the better. There's no such thing as a perfect script, as any writer knows... finding mistakes and editing them is a process that makes the final manuscript a much better piece, since there will inevitably be stuff that is not a real proper mistake, but can do with some change for the better anyways.

You don't want to know how many typos we found in the Beast in the final big edit. Trust me. You don't.

But does that mean every mistake should remain visible? That is the suggestion of Guy Claxton, who says erasers are an instrument of the devil and should be banned from classrooms (all quotes in the following are from this article). Because, and now comes the point that makes me groan,

...schools should encourage students to acknowledge their mistakes because that’s the way the “big wide world” works...

Erm, excuse me? Mister Claxton, what planet are you living on, and how can I get there? The last time I looked around in the "big wide world" that I am currently living in, mistakes are not acknowledged, oh no. They are brushed over, or hushed up, or even rewarded with a hefty chunk of severance pay. When was the last time you heard a politician declare openly and publicly that he or she had fucked up, made a serious mistake, is very sorry and then actually did something to remedy the error? Or when did they obviously learn from a mistake?

There's massive protest against TTIP and CETA (go sign the protest if you have not yet done so, please); but do the politicians admit that it might have been a mistake? Nope - they are still trying to push it through. There's bees dying everywhere because of new pesticides, but does that lead to a ban on these chemicals? Ah no.

Don't even get me started on the EU VAT stuff. 2015 is half gone, the Digital VAT has proven to be a huge problem for small traders, many of which have closed their doors, but what is happening? Very very little, and very very slowly - and the plans to extend the new rules to all goods in 2016 still persist. (Please sign the petition if you have not yet done so, and spread the word so that others sign it, too. It's not looking good for small businesses at the moment, and that does include my own business.)

Do I need to go on? I don't think so. If we have a culture of standing up and admitting your own mistakes, and then openly correcting them and trying not to make a similar mistake in the future, I think it is hiding very, very well in this "big wide world" of ours. At least it's not the culture that our captains of industry, politicians and magnates are steeped in.

Speaking to the Daily Telegraph, professor Claxton said: “The eraser is an instrument of the devil because it perpetuates a culture of shame about error. It’s a way of lying to the world, which says ‘I didn’t make a mistake. I got it right first time.’ That’s what happens when you can rub it out and replace it.

Being able to fix your mistakes and make things better is not something, in my experience, that perpetuates shame about the error. On the contrary - I'd be much more ashamed about something that has to stand visibly for everybody to see. I do know that many of my colleagues feel the same about visible errors in their craftwork. If it can be fixed without trace, it should be okay to fix without trace; often enough, that is not the case anyway, because there will remain a reminder of the error that is at least visible to the person who made the thing. Life is hard enough without having to live with all your little mistakes visible to the world, too.

If you are not tired of reading about this topic yet, hop over to Another Damned Medievalist's blog, whose post in reply to the piece about erasers was the reason for this whole post. (I really just wanted to write a few words before linking to her, but then I got off on a tangent.) ADM's looking at the eraser-is-the-devil thing from a different angle and takes it apart with a little historical knowledge. (To whoever groused her at Leeds to blog more again: thank you!)

(To go to part one, click here.)

There's still more things in that EU memo that make me scared, or sound weird, or plain unfeasible, so I'm not done rambling. Here's the next bit:

Why does the Strategy include measures on parcel delivery?

Today only 15% of consumers shop online from another EU country – which is not surprising, if the delivery charge ends up being higher than the actual price of the product. The measures to be taken will address frequent complaints by e-retailers and consumers concerning a lack of transparency (what are the available delivery options and conditions?); the excessive costs of shipments (especially of small parcels sent by SMEs); the lack of interoperability between the different operators typically involved in a cross-border shipment (resulting in the absence of affordable track-and-trace solutions); the lack of convenience for the final consumer (not being offered last-mile delivery or convenient return options). These issues have already been identified in a Green Paper in 2012, followed up by a Roadmap in December 2013. The postal operators have committed themselves to introduce a number of improvements in the area of quality of services (e.g. track-and-trace services for small parcels sent across borders, easy return procedures, etc). The focus of the future EU measures on parcels is, however, on problems not addressed by the postal industry's own commitments initiative. This includes excessive prices and insufficient regulatory oversight. The Commission is today launching a public consultation to collect views from all the interested parties on the main issues and possible areas for improvement.

I have two bits to say about this. First of all, how are "customers" defined? Anybody who is already buying things? That would include the five-year-old who is going to the bakery to get a piece of cake. Small wonder, then, that the figure seems so low. But is it? And is it that bad, being so low?
There will always be people who do not shop across borders, due to language barriers, not enough internet access, or, yes, because they think shipping costs are too high. I have often not bought something small somewhere online because of high shipping costs - but that applies to German shops as much as to non-German ones.
However, let us not forget that many of these 85% of customers might not shop internationally due to the plain fact that they do not have the need to shop in another country. Because they can get everything they want or need inside their own. And that is perfectly, perfectly fine! Or what happened to "think global, buy local"?

Now for the second bit. Shipping, for a small supplier, is a pain on several accounts. Especially if you have a range of goods with very different shapes, and sizes, and do not ship a load of stuff every week, but do ship to a number of countries plus domestically.

You have to check weights and sizes for pricing, and have to get suitable boxes to ship with. Being in Germany, you also have to register and pay for any new packaging you are going to send out, because it might end up in the Dual System (a recycling system) and you have to pay processing costs for your things. That's all nice and fine theoretically - but for a very small supplier it means registering for a minimum amount of packages, and paying for them, that you will never ever reach. If I ship out paper and carton, inside of Germany (because that only counts for domestic shipping), of about 7 kg per year, but I have to register and pay for shipping up to 200 kg of paper - well, go do the maths yourselves. It's weird.

Then figuring out shipping costs. Yes, it is true that generally, shipping outside your own country will cost significantly more than shipping domestically. Yes, large companies have such a high shipping volume that they can cut special deals with the shipping companies and thus can offer lower prices for shipping, or free shipping. So for your shipping pricing, you have to calculate the cost of the packaging including cost of labels, cost of the shipping itself, plus the time required to do the related logistics (such as filling out customs forms), and the logistics of getting it to the post office. (If that sounds nitpicky and mean, let me tell you that it does add up, and all of these things get easier, faster and cheaper again if you do it often and in bulk.) There are instances where your set shipping price will be a bit above your actual costs, but there are also instances where you pay more for shipping than expected, and the fee you charged does just cover the shipping cost itself, or not even that, and unless you wish to calculate a gazillion shipping cost options and present your customers with a huge list of possible prices... you're stuck with that.

Why is action needed specifically on pricing? Will you regulate prices?

Recent studies confirm that the cost of delivery is still an obstacle to shopping cross-border. Shipping costs is the most common reason (57%) in Europe for not completing an online purchase. 62% of companies that are willing to sell online say that too high delivery costs are a problem (see the newly released Eurobarometer on e-commerce).Tariffs for cross-border small parcel delivery charged by postal operators are often two to five times higher than domestic prices. An example? It costs €32.40 to send a 2kg parcel from Belgium to Austria – over five times the price of €6.40 within Belgium. From Austria to Belgium it costs €14.40 – over three times the price of €4.50 within Austria. Competition appears to be the most appropriate and effective way of addressing today's concerns in terms of affordability. However, for such competition to unfold in a fair and efficient manner, all market participants – retailers, delivery operators as well as consumers – need to enjoy a certain degree of price transparency. Price regulation is only a means of last resort, where competition does not bring satisfactory results, and is not considered at this stage. Close monitoring is essential in order to identify and address any market failures. The situation will be reviewed after two years.

Yes, it can cost an arm and a leg to ship stuff outside Germany. Weirdly, however, I have also had circumstances where shipping the exact same order to Australia, or to England, or to Sweden did cost me less money for the postage than shipping it domestically. What about that? Will you force the German Post to stop offering these cheap international shipping possibilities, to level the playing field? Please don't. As with so many other things, yes, it's not a good thing that we have so many different fees and different structures and different rules - but by imposing even more rules in the hope of making things better, I'm afraid that we will end up being worse off.

Shipping cost calculation, for small companies, will remain a pain. It's just due to the nature of the thing, because there will always be different prices and sizes and weights for the shipment ranges - and they are necessary. How are you going to get "price transparency" across borders when shipping prices inside a country are already so diverse that there are calculating tools to help you get the best possible deal for your shipping? That sounds like a pipe dream to me.