Today we are going to talk about the whole OSS situation that was introduced earlier this summer, and if you live in the EU and use to order absinthe from, lets say Germany, then you will undoubtedly have heard about it. I must say it is not crystal clear to me since I´m not schooled, nor interested, in economics or international commerce, and I can´t say that I´m very well red on the situation BEFORE the OSS was implemented. I have made research about this since the end of June but it is kind of complex and for someone that don´t have any knowledge beforehand it is a lot to take in and understand. But I will explain it as I have come to understand it and you are welcome to correct me in the comments if I´ve got something wrong. And as I said, this is a quite complicated subject so I will narrow my discussion to alcohol, and in perticular absinthe.
OSS stands for "One Stop Shop", why they chose that name I have no idea. Basically it has to do with the registration and collection of Value Added Tax (VAT) when businesses in the EU sell to private individuals in another EU country (and no, the European Union is not a country, as a lot of Americans seems to think, it´s a union of countries). As I understand it, merchants have earlier had to declair VAT to every single country they sell to, and when it reaches that country´s threshold (earlier €35 000 - €100 000 anualy depending on the country) the merchant will have to pay VAT according to that county´s regulations instead of their own. What happens now is that by registering through this new OSS system you will have to pay VAT for each country you are selling to as long as you are selling for more than €10 000 in total each year, to all countries combined, not just that specific country. What´s more, before there were a "floor value" on goods, and if the value of the product was lower than this then you didn´t have to pay VAT at all. I imagine that has been a loophole up until now, sellers registering the value of their products under this "floor value" (even though it might not be) to avoid paying VAT? However, that "floor value" is now gone and you have to pay VAT on everything that is sold, no matter the price.
I havn´t red-up about this part, but as I understand it, this new reform won´t effect the trade BETWEEN COMPANIES within the European Union, for example if a producer wants to sell to a resturant or Systembolaget (the swedish alcohol monopoly). I imagine there is seperate regulations for that.
I think that the benefit of this is supposed to be that it will be easier for online businesses to report their taxes, and at the same time it will be easier for the authorities to verify that everyone is paying what they should (wich might not have been the case up until now). As I understand it, some merchants doesn´t always register VAT to the country they sell to, and the OSS is a way to make sure they DO pay their taxes. This process will, to some extent, be automated which is supposed to make the whole process easier for the merchant (different rates, rules and regulations all over the EU can be confusing).
In practice this means that to us absinthe lovers in the European Union it will get harder to buy absinthe since companies like ALANDIA and absinthes.com has stopped selling to other EU countries (although, since absinthes.com has a French branch as well they will still be abel to sell to France). Me and my Swedish fellows will have to order from other countries outside the EU (which can be very expensive) or from Systembolaget, and they don´t have a lot to choose from. Although, in practice we should be abel to order from ALANDIA and absinthes.com TROUGH Systembolaget, but then the shippingcosts will be €150 minimum according to Systembolagets website. I wouldn´t be surprised if there will be a decrease in business between the European countries (as we have seen with the German alcohol companies), which I can only deduce means that there is many companies that didn´t register VAT correctly before July 2021. Or am I wrong? When you place an order at ALANDIA or absinthes.com you DO pay VAT, I think it was 19%, but in Sweden the tax is significantly higher. I also wonder: there shouldn´t be a problem to sell to countries that have a lower VAT than your own country, right? I mean, for Sweden with (one of) the highest alcohol taxes in all of Europe, we would have to pay less tax if we exported our alcohol instead of selling within our borders, no?
Other variables that is sure to effect all of this could be where your products are stored/sent from, where is your business situated, local tax-regulations and so on, but I´m not versed in this so I´ll not dive any deeper into this. The OSS is also not effecting only the businesses that sell alcohol, but I´m not going to talk about other businesses since I´m not that well red-up, and this is a fucking absinthe-blog.
One thing that I´m quite sure of is that people will try to find loophols or try to circumvent these new regulations somhow, people tend to work very hard if they think they can save a buck or two. I really hope that in wichever direction this whole thing goes, that we will be abel to buy absinthe from other EU coutries again in the future. I also hope that the companies selling absinthe in Europa won´t loose too much business and that they will still be there in the future if/when we are allowed to buy from them again. I placed a BIG order right before July so I should be fine for the foreseeable future, but there is always new absinthes avalible on the market and I kind of want to test them all.
This might not be the most reliable sourse about the OSS regulation, but I wanted to write something about it because of how it effects the absinthe community in the EU where I live, and if you want to learn more I encourage you to do more research on your own.
All the best!
