UK backers of the Ubuntu Edge IndieGoGo campaign are expressing confusion over about whether VAT and duty charges on their pledges will be the responsibility of Canonical or not.
Mobile phones (and the majority of goods) sold in the UK (or imported) are subject to Value Added Tax (VAT) of 20%. This is typically included in the final sale price (e.g. a Nexus 4 bought for £239 includes 20% VAT) but not always.
In theory this would mean that backers “pre-buying” an Ubuntu Edge handset on IndieGoGo for $830 or more could be required to pay an additional $166 before they can receive their devices. And that excludes any potential import duties.
This was, as Fabian A. Scherschel of Lxnews.org points out, the case with the OUYA games console “pre-sold” on Kickstarter.
But with Ubuntu Edge it remains unclear as to who these fees – if any – fall to
As Alan Cox explains on Google+, things get more complex when items are manufactured or sold by a company outside of the EU.
“If the product is being produced outside of the EU then the manufacturer probably isn’t VAT registered but you will instead as importer be liable for VAT (20% in the UK) + Duty (varies from 0% up) + processing fees of the declared value of the goods.”
“So I’d expect if you put $x into a project not running from the EU then in return for goods then unless the goods are also on the market publically (sic) at a price below $x you’d be expected to pay taxes of 20% + duty on $x, and a tenner or so on top. Something to remember in general if investing in an expensive toy from the USA!”
Confused? So are we.