New VAT rules from July 1st 2021

When a disadvantage turns around and become an advantage

- for our EU customers...

This article is mainly directed towards our many EU customers living in other countries than Denmark.

As you might have noticed we are (as rules dictates) charging Danish VAT when you shop with us. The Danish VAT (Value Added Tax) is currently 25 % and one of the highest within the EU.

Our VAT level is not a dealbreaker but competing with other shops in Europe it is an obstacle for us when we have to calculate 25 % and others only 19 %. In many cases we must cut from the profit because of the high VAT in Denmark in order to be competitive.

But EU has worked out new rules in this matter, so I just wanted to share this with you in case you didn't know:
From July 1st, 2021, EU has decided that from this date the seller (us, The Danish Pipe Shop) has to charge local VAT and through EU settle payment of VAT to the other EU countries.

The only exception to this is that if we as a company sell for less than €10,000 to other EU countries. This means if we sell for €3,000 to Sweden, €4,000 to Germany and €4000 to Italy, we can charge VAT using the new rules, because we have sold for more than €10.000 in total to other EU countries.

I am incredibly happy about this as it will allow us to give many of our customers better prices.

Yes, it will cost us some more administration and yes, we have spent a sum of money to make the website work with the new rules, but in the end it will make The Danish Pipe Shop stand even stronger.

From a moral point of view, I also think it is more fair to pay tax (VAT) in the country where the product is to be used, and that you contribute to your own country's tax system.

If you are in doubt what the VAT is in your country, you can find the information here:
https://taxfoundation.org/vat-rates-europe-2019/


CEO, Nikolaj L. Nielsen

This article is written in June 2021.