In January 2020 the UK officially left the European Union (but remember, we’re still part of Continental Europe!), followed by a ‘transition period’ to acclimatise to the changes voted for in a referendum back in 2016.
The 31st October deadline of this period was postponed because the bureaucrats still couldn’t agree on the details. Finally, one week before the revised 31st December 2020 deadline the UK Government finally struck a deal on how things would work from 1 January 2021 onwards.
The new year therefore understandably began with plenty of confusion regarding trade. As a business ourselves, here at ScooterNova we are used to ‘exporting’ magazines and merchandise around the world. However now Continental Europe is classed as somewhere we also ‘export’ to and (at the time of writing) we have more customers in Europe, both trade and retail, than in the rest of the world. For us this means extra paperwork and form filling for all overseas orders now, adding commodity codes and including envelopes full of the required paperwork with the larger parcels – it’s a good job we stocked up on paper and printer ink last month! Maybe that’s why billionaire pro-leave campaigner Sir James Ratcliffe decided not to build his ‘British’ Grenadier 4×4 off-roader (based on the old Land Rover) in Wales and instead leave for France in December. So much for the Brexiteer’s Bridgend factory being “a significant expression of confidence in British manufacturing” as he once boasted…
But anyway, while things have become more expensive and time consuming for businesses, what does it mean to the customer?
Due to the ‘11th hour’ nature of the agreement being signed, there is understandably plenty of confusion on both sides of the English Channel and the Irish Sea for customers and traders. It doesn’t help either that when trying to research things on the official UK Government website I was repeatedly met with notices such as, “The Brexit transition period has ended and new rules on tax and duty now apply. This page is currently out of date.“
What does seem to be the case – until we are told otherwise – is that buying products from businesses within the EU will be much like it is with those outside, so if you have ever shopped in Japan or the USA for example, you may already be familiar with the procedure. Basically goods traded to and from the EU are now to be treated as imports and exports.
According to the Government website today (9 Jan 2021):
“From 11pm on 31 December 2020, consignments of goods with a value of £135 or less that are outside:
- the UK and sold directly to customers (not through an online marketplace [eg eBay and etsy]) in Great Britain (England, Scotland and Wales) will have UK supply VAT charged at the point of sale
- the UK and EU and sold directly to customers (not through an online marketplace) in Northern Ireland will have import VAT charged”.
Yes, if you’re in Northern Ireland it’s even more confusing for you I’m afraid, thanks to an imaginary ‘border’ somewhere in the sea between you and mainland Great Britain.
Back to the overall rules and the £135 limit applies to the value of a total consignment that is imported, not the separate value of individual items that are within a consignment (eg one crankshaft at £135 = £135 but two would value the package at £270). This value only applies to goods and not shipping costs.
“For consignments valued at more than £135 normal VAT and customs rules will apply on importation of the goods into Great Britain from outside the UK or into Northern Ireland from outside the UK and EU.”
This is where and/or how the total cost of buying from abroad is likely to increase compared to pre-Brexit days. Both VAT and Customs Duty would have to be paid by the recipient. VAT is currently 20% and the Custom Duty approximately 2.5%, depending on the goods. Again the VAT is only applicable to the price paid for the goods, but the government website currently states (with regards to goods imported from outside the EU, so likely those from within the EU too now) that Customs Duty is payable on goods above £135 and that:
The value includes:
- the price paid for the goods
- postage, packaging and insurance
The website also states:
“You’ll be contacted by Royal Mail, Parcelforce or the courier company explaining how to pay any VAT, duty and fees for dealing with customs. They’ll normally hold your parcel for about three weeks. If you haven’t paid the fee by then, it’ll be sent back.”
VAT is based on the commodity codes which relate to the products in the parcel. This is part of the customs declaration the sender should put on the parcel. If they haven’t, it may get returned.
If the parcel only contains one type of product this isn’t so bad. However multiple types could mean multiple codes, some might even have different rates. And it is all this that the courier company may have to wade through, hence there could be an extra handling charge on top of everything else.
And just a warning for anyone thinking of buying a £2000 engine from Europe and claiming it’s only worth £100. Not only are you asking to seller to fraudulently complete the paperwork, but if the package gets lost or damaged in transit then remember you’ll only be compensated for its declared value.
Of course if it is a Casa Lambretta or Performance part you want, or anything by SIP or Scooter Center Koln/BGM, then there are plenty of scooter shops here in the UK that stock their ranges. Shopping locally means the price you see is the price you’ll pay (plus shipping of course, if not buying over the counter) and any returns should be easier to deal with if no borders have to be crossed. Of course there are lots of products we scooterists buy from overseas: carburettors by Dellorto in Italy and Mikuni in Japan, tuning kits from Italy and Spain, LML and SIL spares from India, and scooter tyres from anywhere and everywhere except the UK.
But we do make a few parts here in Great Britain too. Crankshafts have been produced here for a number of years, shockers, wiring looms, control cables, brake hoses, windscreens, replacement body panels, and exhausts too for example. Indeed I road-tested one of Richard Taylor’s first British-made GT kits as far back as the late 1990s. And all these manufacturers will also have to follow a similar procedure to sell into Europe now as our friends in the EU do to us. Prices may go up eventually to cover these extra costs, only time will tell.
I’m sure things will settle down in a few months time and thing become clearer; for the sake of both the scooter scene and people’s livelihoods I hope so. But until then before buying or selling across any border make sure you do some research and if necessary ask questions concerning unexpected fees to avoid any potentially nasty surprises further down the line.
Happy shopping folks!
ScooterNova is an independent scooter magazine published and printed in the UK every two months, by scooterists for scooterists. Edition 23 (Jan/Feb 2021) is available now from all good scooter shops, you can also subscribe or buy online via our web shop. For details visit www.scooternova.com