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Steam will soon take 14% VAT

rustybroomhandlerustybroomhandle
in General
In case you missed it.

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Several countries have enacted sales taxes (VAT, GST, JCT) on sales of digital goods and services that will apply to Steam sales. Look out for changes in your upcoming reports, you will see reporting of taxes in ten new countries.

March 2017:
Switzerland 8%
South Korea 10%
Japan 8%
New Zealand 15%
Iceland 24%
South Africa 14%
India 15%

April 2017:
Serbia 20%

May 2017:
Taiwan 5%

July 2017:
Australia 10%

The VAT tax amount will be included in the advertised price of your product, just like VAT is currently treated in the EU. This means the customer will pay the price displayed on the storefront, and the tax will be separated out afterwards.
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This is interesting since my company is not registered for VAT at the moment, nor was I lead to believe I needed to be.

Thanked by 1critic

Comments

  • criticcritic
    edited
    I've been wondering about this, surely they have already been taking VAT in countries that already have it required, like the EU, on sales to people buying within the EU and charging that to the developer no matter where they are?

    Then this would just be another transparent fee that we have already been paying when selling to other countries, or is this different?
  • EvanGreenwoodEvanGreenwood
    I'm not 100% sure what this means, but I'd expect that this doesn't mean developers need to register for VAT. This means Valve will be paying the South African government VAT, and that will be coming out of the revenue that eventually reaches developers.

    This shouldn't affect us other than meaning we make less money in those regions. As developers we don't sell anything to our customers, we license our software to Valve to be sold as a service through Steam.

    Unless I'm confused about this?
    Thanked by 2critic AngryMoose
  • jackshielsjackshiels
    edited
    EvanGreenwood said:
    I'm not 100% sure what this means, but I'd expect that this doesn't mean developers need to register for VAT. This means Valve will be paying the South African government VAT, and that will be coming out of the revenue that eventually reaches developers.

    This shouldn't affect us other than meaning we make less money in those regions. As developers we don't sell anything to our customers, we license our software to Valve to be sold as a service through Steam.

    Unless I'm confused about this?
    I saw VG247 speculating that developers will have the option to absorb the tax or add it above the standard price. My gut says they'll stick to round, easy numbers (499/599 etc.). We haven't setup our steam publisher account yet, so I don't know the exact details.
  • LexAquilliaLexAquillia
    Steam is the one collecting VAT on behalf of SARS and so they will be the one paying it to SARS. As per the steam agreement that you sign this amount will come from the portion that is eventually paid out to devs. You don't need to be registered to VAT. It also shouldn't affect your bottom line to much as a minimal amount of sales will be coming from SA.
    Thanked by 6dammit jackshiels Fengol critic EvanGreenwood garethf
  • leonalchemist2leonalchemist2
    Been trying to research this, sounded to me like you pay around 30% to have your game on steam, then usually we have to pay taxes separately let's say 40% for the maximum amount or around there, so do we have to lose on another 14% VAT on top of that 'cause paying 84% out of your hard work seem a bit crazy and even more so if other site hosts take another 5% + publishers fees, then paying out expenses for your game; doesn't make sense to me, taxes is such a headache :P
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