Web Retailers Facing a Taxing Time!

There have been a huge number of web based retailers who have been taking advantage of this easy to start up trading environment over the last couple of decades, whilst many of those companies have grown huge in size such as Amazon, there have always been lot of small independent retailers opening up small boutique websites catering for a much smaller customer base.

However, over 200 small web based retailers have closed up shop since the start of the year due to a new set of European VAT laws, rules and regulations. Those changes in VAT had been designed to hit some of the much larger and better known web retailers as many of those companies have been bending the rules and have been able to get out of paying huge potential tax bills by locating their company Head Quarters in low tax havens.

The main changes in this Tax regime is that anyone who is selling any type of digital based products such as software, eBooks and any type of web based digital service has to charge VAT at the rate that has been set at the rate charged in that buyers’ country of residence.

Whilst this should not pose any problems for the much larger online retailers, this has cause untold nightmares for the much smaller web based retailers, and due to it being something that is not easy to master, becoming a tax expert in each country you trade in, some 200 plus companies have chosen to close down their web based retail outlets rather than risk hefty fines.

Many industry commentators are demanding the Governments such as the UK Government suspend this new tax regime and somehow simplify the way in which it is being imposed, to allow smaller retailers to be able to put into place some form of system whereby they can legally operate without inadvertently being hit by huge fines.

However, these demands are currently being met with a talk to the hand response and as such the number of smaller web retailers opting to close down their sites is going to continue, whilst those larger better known retailers are likely to flourish, whilst also having the power to continue their low tax paying strategies.

Keep that in mind if you are looking to place any type of retailer based Binary Options in the coming weeks or months, as some of those companies still in business will be picking up a large share of those now closed smaller retailers business.