Please be more open that your prices are without vat [all things tax related see here]
I don't know what the usual behaviour would be in Canada and the USA but in Europe it's common to advertise the full cost with vat if you are dealing with private customers. I am not sure about common European law but I am pretty sure that businesses are obliged to name the full price if they're dealing with European customers.
That means it would be a good behaviour & probably a legal requirement to show your subscription prices also with the appropriate tax.
Because of the different tax rates it is hard to guess your prices. You are saying that 1 month costs 5 USD and 1 yearly subscription costs 48 USD.
But only after adding my credit card data I and agreeing to pay I will be informed that I have to pay 57,12 USD (48 plus 19% vat).
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Unfortunately the comparison turns out to be even less favorable for Families than I thought.
LastPass advertises with $1/month and charges $1/month (which can even be paid with your iTunes credit; in my country there are often deals on gift cards resulting in paying only 80 cents for every dollar value).
AgileBits advertises the price without tax and charges more than 20% extra (in many European countries) on top of the $5/month, if I understand this post correctly:
https://discussions.agilebits.com/discussion/61597/billing-question-10-bonus-tax
(I understand the VAT is imposed by law; I'm also not sure how LastPass can offer a fixed price everywhere - however the price difference between the offerings increased because of this)
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Hi @dahanbn
We can't do that, unfortunately. As you've mentioned every country has a different tax rate. We don't know what country you are in until you provide us with your credit card information (the tax you are charged is based on the county of your CC's origin). So, that is the soonest we can display the applicable tax.
There would literally be hundreds of different prices to list if we were to attempt to list every country's price including tax, and they'd all be subject to change at any time. This makes it prohibitive to include such a list.
I'm sorry for the inconveneince. How do other non-European businesses who have to collect taxes, but don't know where you live, deal with this?
Thanks.
Ben
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Hi @XIII,
I would also be interested to know that, but I suppose that is a question for LastPass. Previously we were exempt from charging VAT due to the volume of sales we had in the relevant countries. The law changed in early 2015 and we had to begin remitting VAT.
Ben
P.S. Let's please try to keep all of the discussion related to tax in this thread, instead of spreading it out over multiple. Thanks!
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It seems like advertising with total prices is indeed required by European law:
http://europa.eu/youreurope/citizens/consumers/unfair-treatment/unfair-pricing/index_en.htm
However, I don't think this applies to merchants (like AgileBits) that operate from outside the EU.
Still it would be fair if AgileBits did. I have seen websites were one can use a drop down list to show the price in local currency (by selecting the desired country or currency in that list). Perhaps that's an option?
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Hi @XIII,
Yes, my understanding is that those laws only apply to EU and select other countries, not Canada (where AgileBits operates).
While that may be possible within the Families/Teams interface itself, it would not be possible in places like our newsletter and blog, forums, etc.
In the US, and I assume Canada as well, it is generally understood what goods and services are taxed and which are not. Tax is often not mentioned, but assumed, when discussing pricing.
I'll certainly pass the feedback along.
Thanks.
Ben
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So the price that is written in the billing section is the exact price in dollar that I will pay? So there are all taxes included in this?
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So the price that is written in the billing section is the exact price in dollar that I will pay? So there are all taxes included in this?
Probably not, since I see $5/month (monthly) and $4/month (yearly), so almost certainly without the EU taxes being applied.
If I understand dahanbn correctly you will only see the exact price after you have added your credit card (which I did not try yet) and agree to pay.
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But only after adding my credit card data I and agreeing to pay I will be informed that I have to pay 57,12 USD (48 plus 19% vat).
@dahanbn: As Ben mentioned, part of the problem here is that we don't "know" that you need to pay VAT until you enter your payment information. At that point, the billing address is available for that purpose. The other issue is that advertising a VAT price for folks would be, well...anywhere but the EU, it will be wrong. I'm in the US, so I don't pay VAT; the government has other ways of getting money from me. :lol:
Ultimately, we advertise the actual retail price for 1Password. When you're taxed, that's over and above what we charge, and we don't get to keep that: it's remitted to the appropriate authorities. So while I appreciate that it's unpleasant from a consumer standpoint (after all, I pay 10% in sales tax alone), it isn't our decision
Still it would be fair if AgileBits did. I have seen websites were one can use a drop down list to show the price in local currency (by selecting the desired country or currency in that list). Perhaps that's an option?
@XIII: You raise a good point. However, the problem with trying to do currency conversions is that it's not static. It's an open secret that credit card companies won't necessarily process the payment as soon as possible, instead opting to wait for a more favourable (to them) exchange.
So the price that is written in the billing section is the exact price in dollar that I will pay? So there are all taxes included in this?
@ntimo: XIII is right on. It should be reflected under "Next Payment" after you've entered your credit card information.
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Two remarks.
-Why you don't advertised with a comment "without VAT" beside the price. It will be more "honest" (even it's not the correct word).
- You wrong when you apply a VAT depending on the credit card country. In EU, you can have a credit card from another country and not living in this country, so you will apply the wrong VAT.
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-Why you don't advertised with a comment "without VAT" beside the price. It will be more "honest" (even it's not the correct word).
@Spinacle: That's a great idea! I think maybe we should say something more like "tax not included" since that's more universal (I know what VAT is only because I work with some awesome Europeans). :chuffed:
- You wrong when you apply a VAT depending on the credit card country. In EU, you can have a credit card from another country and not living in this country, so you will apply the wrong VAT.
That's a fair point. After all, you could live exclusively in Country B while still maintaining residency (for a time) in Country A...but I'm not sure it's fair to expect AgileBits to figure all of this out somehow. That's kind of between you and the government (for tax purposes) and the credit card company (for billing purposes). And after all, if you don't have a mailing address in Country A, eventually your card will expire and you won't be able to get a new one without a valid address where you really live in Country B.
If you have true dual residency, it's really up you and the authorities to hash that out. Legally speaking, if your address is in Country A, you should be taxed based on that. Your credit card tells the vendor — AgileBits or otherwise — that you live in Country A, and the only reasonable thing to do is to assess tax based on that information, which you yourself provided to the credit card company. I know "regionality" can be a huge nuisance (and a bit silly, when it comes to things like iTunes and Netflix), but this is the world we live in. :unamused:
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