The point is tax on tax happens IN the UK. ie within the one country.
The export/import situation is entirely different. Normally retail goods are not subjected to any form of export tax before leaving the country. But in the WNW case the full, tax-inclusive NZ price is being used to calculate UK import duty. (Of course gcn is correct in that WNW are keeping the tax element for themselves and none of it goes to their country's excise dept!)
I don't know what the NZ equivalent of VAT is, but if we assume a 20% figure for the sake of argument, then a $99 kit sold locally would net $82.50 for the manufacturer and $16.50 for the NZ taxman. The normal rules of export would be that the kit would leave the country without any VAT, ie at $82.50 and then import duty and/or VAT would be applied by the new country's tax man.
So in the UK The kit should cost $82.50 + $16.50(UK VAT) +£8 (UK import handling charge).
But in fact it is $82.50 + $16.50(NZ "tax" not actually paid) + $19.80 (UK VAT) +£8.00 import duty.
Don't you think we have just found out how WNW justifies and accounts for its free worldwide shipping policy. They perhaps regard the NZ "tax" contained in export sale prices as a contribution to shipping costs. The only country actually getting free shipping is NZ itself!
I expect any international agents appointed will refuse to pay the bogus tax and perhaps export purchases via these channels may be considerably less than charged by Hannants at present?
S
Our version of VAT is GST (Goods and Services Tax) which is 15% on anything purchased and consumed within New Zealand. I am wondering (but not 100% sure) if kits which are exported are zero-rated for GST as they are not "consumed" within NZ. For example, if I book a flight from Christchurch to Auckland there is 15% GST on it, but if I book a flight fron Christchurch to Melbourne it is zero-rated as the service is not used within New Zealand.
