Different prices of Premium Membership

[+Condorito]

This doesnt sound very good and i will be following this thread to see what happens...

Does anyone know if it has also changed prices in places outside the european union, such as Australia?

[+MrCJDL]

I'm sorry to say that you guys seriously need to get better tax/legal/accounting advice.

 

As far as I remember, the last time I purchased Premium Membership, I did so from Groundspeak, Inc. 837 N 34th Street, Seattle, WA 98103 - which, and correct me if I am wrong, is a US registered company. As a US registered company, you do NOT (legally) have the right to charge VAT to customers based within the E.U - heck you probably can't even charge us U.S. state sales tax !

 

Unless, of course, you have a subsidiary company - registered and domiciled for tax purposes within an E.U. country. If this is the case, you MUST (under EU laws - Distance Selling Regulations, if you want to check) supply the customer with the full name and address of the E.U. registered entity, and you MUST supply the full registered address of the EU entity, along with it's company registration number and VAT registration number - these are actually supposed to be stated on all and any correspondence - including your website.

 

Furthermore, if you do have an EU domiciled subsidiary you may only charge the VAT rate of the country that it is registered in (most commonly, Luxembourg @ 15%). It is illegal to charge VAT if you are not passing it on to the tax authorities within the country you are registered, or if you are not a VAT registered business.

 

I tell you how I read this... you're getting hit with PayPal's cross border payment fees, which are currently 3.9% + $0.30 USD, and you want to pass them on to your customers. And you know what, I fully understand that... and if that is the case, fine, charge us an extra 5%. However, to disguise it as a method of reducing the cost for customers when this is blatantly untrue, is frankly disgusting - we don't pay 'massive bank fees', we simply pay a currency exchange rate ! As a matter of interest, my last renewal for $30.00 via PayPal, cost me GBP £19.06 on my Credit Card.

 

I don't have a 'recurring' membership, as I don't give ANYONE the authority to automatically take money from my accounts... I pay annually each year, and I renew when it's due... however if this debacle is not resolved, you can add me to the list of members that will not be renewing... and I'm sure you can add a few thousand other European cachers to that growing list.

 

Seriously guys, this is a bad move.

 

Regards,

Chris.

[+wmpastor]

 

And please, even if we come from Europe, where we still have no refrigerators or electricity and are not that bright - paaaaaleeeeeeeeeeeeese, don't expect us to buy these specious reasons... or rather: the premium membership...

 

Greetings

HansHafen

No, it's you guys in Europe who have the brains & the money! The USA is just coming out of the worst financial crisis in 80 years!

[+Tschakko]

 

And please, even if we come from Europe, where we still have no refrigerators or electricity and are not that bright - paaaaaleeeeeeeeeeeeese, don't expect us to buy these specious reasons... or rather: the premium membership...

 

Greetings

HansHafen

No, it's you guys in Europe who have the brains & the money! The USA is just coming out of the worst financial crisis in 80 years!

 

Well get the news: Europe still is in this crisis with zyprus just being the latest desaster! I don't know who told you everybody here has got money???

 

And as stated before: If there was to be an incomelevel related Membership, let it be. But say so and make it reasonable!

 

Edited to correct some misspellings... There may be more though

Edited April 19, 2013 by Tschakko

[+GEO-BREIN]

The new pricing eliminates bank fees for geocachers outside the of the US, as you now are able to pay in your local currency and do not have to pay a transaction fee. More importantly, as Lil Devil mentioned, VAT is now included in the price.

 

So, since you're saying that VAT is included in the price, you're saying that there is a Groundspeak company (office) somewhere in Europe??? Nice to know. Where is that office located???

This is just a lot of crap! Geocaches can't be commercial, but Groundspeak can play with us and just steal our money???

I sure would have an explenation for this matter, and not only saying that VAT is included!!!

[+2000wu6]

Digital content, like subscriptions, consumed in the EU is subject to VAT. I'm sorry, but we will not be posting our EU VAT registration.

Sorry to say, but your excuses for this 33% price hike for German users are more than thin... And refusal to post a usually publicly available registration number just seems to confirm that the official reasoning may not be the actual reason. If GS believes that after 10+ years an increase of membership fees for PM is needed, that is well within your rights. But alienating a large part of your customer base by singling out countries with selective price increases is not the way to go. I believe I can speak for a large percentage of the affected catchers if I say that the couple bucks more isn't the problem or the reason for the complaints. Expecting them to be stupid and accept half-a** excuses for being treated differently is.

[+MacDD]

You saw all the arguments. Now take your loss and withdraw this stupid idea. I myself will forward this topic to all my caching friends and advise them to stop paying for your new cars.

 

Are you out of your freaking minds?

[+Beach_hut]

I'm sorry to say that you guys seriously need to get better tax/legal/accounting advice.

 

As far as I remember, the last time I purchased Premium Membership, I did so from Groundspeak, Inc. 837 N 34th Street, Seattle, WA 98103 - which, and correct me if I am wrong, is a US registered company. As a US registered company, you do NOT (legally) have the right to charge VAT to customers based within the E.U - heck you probably can't even charge us U.S. state sales tax !

 

Why do you think you have to include VAT to sales to Europe? VAT has to be only included for sales inside the European union. Last time I checked the US didn't belong to the European union.

Atti

 

Read the link on post 16, both. Website subscriptions consumed within the EU, irrespective of their point of origin, are liable for VAT.

[+Atti]

@Moun10bike

Ok, then let's do a small calculation.

Provided that you have to impose VAT on us Europeans: VAT in Europe is about 20% (unless reduced rates apply). But let's take 20%.

So the Europeans should pay 36$ instead of 30$ the Americans pay because of VAT. I'm fine with that. You are not responsible for the European VAT system.

But how much is that in Euros? Currently the exchange rate is from $ to € about 0.75, meaning you get 3€ when you pay 4$. So if you wanted to charge us 36$ so you will get the 30$ net from us that's 27 €.

What you announced to charge us is 30€. Did you actually calculate how much that is in $? Well, let me do that for you: for 30€ you'll get 40$.

 

That makes 4$ the Europeans have to pay more for PM than the rest of the world.

This is just not ok. So, no wonder we're not amused. I'd suggest you redo your calculations.

 

Atti

[+DO1MET]

Since there is no answer given to an important question yet: Where is your tax registration number? If you take european or other national laws as an excuse for excessive raises, obey them!

I´m serious, you should either publish it, or be honest and tell your "customers" that the VAT-issue was a big joke!

 

I just stopped my self-renewing premium membership and I hope this to get a mass phenomenon in europe. Think better GS.

[+Beach_hut]

Digital content, like subscriptions, consumed in the EU is subject to VAT. I'm sorry, but we will not be posting our EU VAT registration.

 

Some people in this thread do make a valid point, in that I'm pretty sure you need to display the VAT registration number on invoices by law, and itemise the VAT element.

 

I get that there's a buffer now factored into it for the FX rates, so on reflection, I'd like to request the following: that EU customers have the option to be billed denominated in USD, with the VAT, so by my reckoning $35.99 for the UK, and we therefore convert it into our local currencies using the applicable FX rate at the time of the transaction as we did before.

 

I'd be keen to find out if this is possible.

[Alan White]

To be clear, only new/nonrecurring members will be paying the new rates. If you have a recurring membership, you are locked in at the rates you have always been paying.

I can't find the quote, but it's my understanding that premium members were locked in at the price they first paid provided they continued to renew. There was no requirement that the membership be auto-renewing.

[+Tschakko]

By the way:

Isn't there already the Washington State VAT included in the original 29.99$?

Edited April 19, 2013 by Tschakko

[+Beach_hut]

By the way:

Isn't there already the Washington State VAT included in the original 29.99$?

 

I might be wrong, but I don't think it is. I just looked at their (Washington State Department of Revenue) website at a list of Sales Tax liable products, and I didn't see anything that would apply.

Edited April 19, 2013 by Beach_hut

[+-Mark-]

Oh, nice: If I want to change my payment details (e.g. a different credit card), I first have to choose what to buy (which is stated in Euros).

 

Why? I only want to change the payment details of my recurring membership. Which is, believing, what Moun10bike wrote, charged in Dollars.

 

Answers?

[+DO1MET]

Oh, nice: If I want to change my payment details (e.g. a different credit card), I first have to choose what to buy (which is stated in Euros).

 

Nice point, so it seems like I´m out of my $-Membership for interrupting my renewal, even if the actual pm lasts for a few weeks. Nice work gs.

Edited April 19, 2013 by DO1MET

[+searchjaunt]

I'm sorry to say that you guys seriously need to get better tax/legal/accounting advice.

 

As far as I remember, the last time I purchased Premium Membership, I did so from Groundspeak, Inc. 837 N 34th Street, Seattle, WA 98103 - which, and correct me if I am wrong, is a US registered company. As a US registered company, you do NOT (legally) have the right to charge VAT to customers based within the E.U - heck you probably can't even charge us U.S. state sales tax !

 

Unless, of course, you have a subsidiary company - registered and domiciled for tax purposes within an E.U. country. If this is the case, you MUST (under EU laws - Distance Selling Regulations, if you want to check) supply the customer with the full name and address of the E.U. registered entity, and you MUST supply the full registered address of the EU entity, along with it's company registration number and VAT registration number - these are actually supposed to be stated on all and any correspondence - including your website.

 

Furthermore, if you do have an EU domiciled subsidiary you may only charge the VAT rate of the country that it is registered in (most commonly, Luxembourg @ 15%). It is illegal to charge VAT if you are not passing it on to the tax authorities within the country you are registered, or if you are not a VAT registered business.

 

 

I think that the facts are clear: EU (non business) customers needs to pay VAT to a US based company, even if there is no EU subsidiary. Article 58 (as mentioned in this doc) states:

"In July 2003, the EU started applying VAT to sales by non-EU based companies of EES to EU-based non-business customers. As from January 1st 2010, those measures have become permanent. Before the application of the new rules, U.S.-based suppliers of ESS had no obligation to charge VAT on their EES sales to EU-based non-business customers because the place of supply was the U.S. where VAT is not applicable. EU supplier felt the rules were discriminatory and new rules have been adopted to rectify this competitive disadvantage.

All supplies consumer within the EU are now subject to VAT because VAT on services to non-business customers must now be collected at the rate applicable in the Member State where the customer is located.

Therefore, U.S.-based providers of ESS to EU non-business custom ers must charge the VAT rate applicable in the Member State of residence of their customers and submit the VAT receipts to EU-based VAT authorities. "

 

The most important thing is that is charged at VAT rate applicable in the Member State of residence and thus no flat fee. The example of Luxemburg is NOT common since Lux has somewhat the lowest taxes of the EU.

 

Having said this, I do understand that the VAT rule inevitable, as long as it charged properly. The recurring argument doesn't make any sense in that perspective since all VAT is due.

If EU regulations does allow the recurring exception (for old customers), I would like to see Groundspeak to allow recurrent payments via Paypal. For security reasons, I'm not willing to provide CC info on each site that asks for it.

 

Then the transaction fees. If I look at Paypal fees, I calculate the following price for a 1 year membership

30$ = 22.96 Euro (source Google currency converter)

Paypal fee (worst case when GS receives < 2500 Euro/month): 3.4% + 0.35 Euro = 1.13 Euro

VAT (I take BE as example) -> 21% on 24.09 (22.96 + 1.13) = 5.06 Euro

Total: 29.15 Euro

 

Conclusion: I have to admit that the 30€ isn't that far from the actual cost as one thinks. I wonder if it was calculated or just a lucky guess.

 

Having said this, I do have some major reservations:

• Groundspeak shouldn't work with a flat fee, but needs to calculate VAT, based on the VAT rate applicable in the (verifiable) EU member state of residence of the PM
  
• Groundspeak should announce membership price WITHOUT VAT and fees and indicate what the additional costs are, based on the residence of the PM
  
• There shouldn't be any discrimination between new and old PM, recurrent or not
  
• If Groundspeak wishes to give a reduction for old PM (base price 24,45 Euro for BE) who are willing to pay recurrent, they should allow people to pay via Paypal and not only credit cards in order not to discriminate
  
• Groundspeak should communicate more open and honest about things. That includes other subjects too.
  

[+cahhi]

I think that the facts are clear: EU (non business) customers needs to pay VAT to a US based company, even if there is no EU subsidiary.

 

If this is fact, then answer please one question:

 

How is it possible for Amazon Cloud and for Dropbox to charge the same price in US-$ anywhere? And why does even Apple charge you for iCloud with 20US$=15€ while the computers are about 1€=1US-$?

[+Chapeman]

... on facebook, GC deleted many of posts, concerning the new prices ... if there are reasons, to increase the price ...

1) inform the members

2) give correct informations

3) they will pay

 

and not

1) tell the members, we have something good for you

2) with incorrect informations (you can save money)

3) "kill" their requests or playing the three monkeys

 

Nothing else to write ... or?

Edited April 19, 2013 by Chapeman

[+Saff]

I'm surprised to only hear about this on the forums. Could this not have been included in a newsletter, on the webpage, via Facebook... all of the above?

 

The best way to make sure everyone is happy with an increase is to make it public and give a clear break down of costs. If I can see you have no other choice then I happily accept the increase and I feel positive about the company.

 

Conversely, if I find out about the increase through the rumour mill and can't work out exactly where the money is going then: 1) It leaves me with a bad feeling for the company/service 2) I wonder -- do I really need this?

[+on4bam]

 

Paypal fee (worst case when GS receives < 2500 Euro/month): 3.4% + 0.35 Euro = 1.13 Euro

 

 

This fee is the same for everyone regardless of their location and should not be added to the EU fees as it is not added for non-EU members.

 

US$30 is (today, xe.com) €22.90

VAT in Belgium is 21% = €4.81

Total = €27.71

 

Luxemburg has 15% TVA so that makes €22.90 + €3.44 = € 26.34

 

In fact GS is charging EU members US$32.46 +VAT instead of $30 +VAT. What is the extra $2.46 if not a price hike.

[+-Mark-]

I'm surprised to only hear about this on the forums. Could this not have been included in a newsletter, on the webpage, via Facebook... all of the above?

It was on Facebook. Until they couldn't stand the feedback anymore and deleted the post.

[+chillypenguin]

Which shows that they are aware of our feelings.

[+Two Tykes]

Forgive me if I am in error here - I am not a tax-savvy person by any stretch of the imagination!

If I paid for Premium Membership through a VAT-registered company here in England I would be able to claim back the VAT. For this I would require the VAT registration details of the service provider, yet Groundspeak have said they will not publish such a detail.

[+wantsky]

Breaking news from our Groundspeak HQ mole:

 

Person1: I told you they know how to use calculators in Europe. It was them who invented the abacus!

Person2: Come on! Even you don't believe that, I'm sure it's some kind of revenge from Garmin.

Person1: What do we do now?

Person2: Let's increase the Premium price to 50USD for all. That should settle everything.

Person1: You're a genius! Such a relief!

 

Groundspeak, congratulations and good luck.

 

[+germanybert]

WOW!!! As an American Ex-pat I must say that it is very embarressing that GS would be treating our European friends like this. Funny how I as an American citizen can still pay in USD and not pay EU VAT even though I have lived in Germany for 20 years.

Edited April 19, 2013 by Geo Jedimeister

[+germanybert]

What you EUers don't understand is that GS has the "Super Double Secret EU VAT Number" which by law does not require release to the public. It is kinda like the "Double Secret Probation" that Delta House in the movie Animal House was put under by Dean Wormer.

Edited April 19, 2013 by Geo Jedimeister

[+Twentse Mug]

1. Not all European countries have euros. 2. Not all European countries are EU. 3. Not all European countries have the same VAT.

[+MrCJDL]

Ok, so having looked into this a bit further... it seems that the EU in their infinite wisdom did decide that US registered business selling 'e-services' to an EU consumer (or non-business) customer, needs to charge VAT. Depending what research you do, they are either supposed to charge the prevailing rate of VAT in the state that their customer is resident in... or they are supposed to be registered in an EU country, and charge that VAT rate. Regardless of this, I still call BS on the VAT argument.... it's a price-hike and that's it - if they show me their VAT registration number, and proof of vat payments to an EU VAT authority, then maybe I'll believe them.

 

As for me, luckily I run my own business, so I think my company will be purchasing my PM (VAT free), and it'll then be selling it to me at the one-off special rate of £0.01 (including VAT).

 

Alternatively, I may feel the need to move to America come renewal day ! Alternatively again, I may just not bother renewing.

[+MartyBartfast]

I have a strange feeling that when my renewal time comes around there may be a new basic member joining up in the USA who, in a fit of altruism, may just gift me a membership at the US rates, and I'll never have to pay for my own membership ever again - happy days :rolleyes: .

[+C8W9]

What's there to stop me from clicking on "not my location" when purchasing a membership, changing it to US, and then paying in dollars through Paypal?

 

I don't believe this is a VAT related increase.

[+chris_rocks31]

Tomorrow my premium membership ends and will not be renewed.

 

I'm not ready to support a company that ignores the wish of the customer such as Groundspeak. I don´t support any company that censores opinions on Facebook, in the blog or in the forum like a communist regime. I also don´t support any company with a non-transparent pricing policy.

Sorry, but there alternative plattforms and alternative services...

[+wmpastor]

I notice that a specific book will sell for different prices in the US & Canada, even adjusted for the currency value differences. Major magazines sell for different prices in the USA & Europe. City newspapers sell for different prices in the city & suburbs (20 km away). What's wrong here? US prices will go up soon, if that makes you feel better....

[+on4bam]

I notice that a specific book will sell for different prices in the US & Canada, even adjusted for the currency value differences.

 

Yes, but the price is the same for anyone buying from the same shop. There may be additional charges for shipping but the base price for the product remains the same.

[+prunie]

Well then , This will result in a lot of basic member european geocachers ! Europeans dont like it to be discriminated.

[+dartymoor]

Digital content, like subscriptions, consumed in the EU is subject to VAT. I'm sorry, but we will not be posting our EU VAT registration.

 

You may want to check your legal status if you intend to stick by this statement as you are likely to be reported for VAT fraud. I'm not aware of *any* reason to deny a VAT registration number unless you don't have one.

 

My understanding is that it is illegal to charge vat without a VAT registration number.

 

A company charging VAT may not withhold a VAT receipt when requested which MUST contain the VAT number.

 

References:

 

http://www.hmrc.gov.uk/vat/managing/charging/vat-invoices.htm#3

 

http://www.hmrc.gov.uk/vat/sectors/consumers/basics.htm

 

I'm interested in your reply, and whether this post gets deleted. Screenshotted just in case...

[+on4bam]

A company charging VAT may not withhold a VAT receipt when requested which MUST contain the VAT number.

 

People might start thinking that VAT is added to their bill and not forwarded to the EU taxmen

 

My subscription is up for renewal and when (or if) I pay I insist on having the VAT info on the receipt just like that number is on ANY receipt and invoice I get when paying for something.

 

BTW, Seattle has woken up by now so we're eagerly awaiting any more info from GS (above or below their pay grade)

[+dartymoor]

Also, do you pay any taxes in America for your European customers? If you don't, yet the price was previously the same for all customers, why isn't this deducted before EU VAT is added?

[+Der Zappo]

Meanwhile my opinion is this, that GS isn´t able to do the simplest things right. If there must be a tax- why not in former times? Should WE as users manage these fundamental things by an inquiry at OUR tax authority?

 

We don´t understand your acting. Isn´t it a little bit like amateurs, that want to play in a profi league? I mean - tax aspects? This is the first thing i become clear BEFORE i nail my company sign to my door.

 

Der Zappo

Edited April 20, 2013 by Der Zappo

[+el_L0qu1t0]

Ich habe keine Probleme 30 Euros zu bezahlen. Aber ich hab ein Problem das solche News irgendwie nicht angekündigt wird und man es so nebenbei erfährt. Schwache Leistung. Wenn ihr mit dem Geld neue, bessere Server macht, sinnvolle Verbesserungen für die Website und unser Hobby oder eine europäischen Sitz macht dann wäre das in Ordnung. Aber so hintenrum mit den fadenscheinigen Begründungen gibts halt für mich nur den Weg des BMs oder den kompletten Wechsel zu opencaching.de

[Moun10Bike]

This is definitely all a learning curve for us, and we apologize for the confusion. Our management has a meeting planned to discuss all of this and Bryan will be posting this afternoon in answer to your questions. Please bear with us during this transitional time.

[+on4bam]

Why cannot the price be the same for everyone then apply any local taxes at checkout?

 

Huh... ?? That's way to simple

[+Der Zappo]

This is definitely all a learning curve for us....

Sorry, this is "orks speech". Do the things right or wrong - we all make mistakes. But be honest and don´t try to fool the people, on which you depent...we will thank you for this - don´t worry.

 

Der Zappo

[+learnincurve]

This is definitely all a learning curve for us....

Sorry, this is "orks speech". Do the things right or wrong - we all make mistakes. But be honest and don´t try to fool the people, on which you depent...we will thank you for this - don´t worry.

 

Der Zappo

 

I'm not going to lie, I'll still be premium. I don't mind paying the extra if the yanks have a £1.44 rise as well, if they don't I may grumble a bit on facebook about it. However the UK does not have the Euro, in fact we don't even have the symbol on our keyboards. The line about currency conversions does not work for us as we would be charged just the same as if it was £ to $. It's also not the most stable of currencies to be converting into so if you wouldn't mind awfully we would rather stick to our own £s which have never had a price set. Also setting it to the correct 20% vat would also be nice, £1.44 will buy me half a pint.

 

edit: or £1.44 could go to charity, I suspect 90% of the complaints would stop if the extra you are collecting were to go to cancer research, everyone hates cancer.

Edited April 19, 2013 by learnincurve

[+Icenians]

Digital content, like subscriptions, consumed in the EU is subject to VAT. I'm sorry, but we will not be posting our EU VAT registration.

 

In UK If I pay VAT then the person I'm paying it to MUST supply the VAT number and a VAT receipt if requested. They also need to pay the VAT collected to the UK government.

 

So, "Not suppling the VAT number" is not good enough.

[+MadCatERZ]

I do not really know much about taxes and international business relationships,

but I know that it's a very very strange coincidence that the fee in U.S. and Europe

should exactly be the same amount except the Currency, or as we like to say in Germany

 

"Ein Schelm wer böses dabei denkt"

 

And: Companies who are willing to offer a good customer service make an announcement

before increasing the prices by 30%.

[+Tschakko]

This is definitely all a learning curve for us, and we apologize for the confusion. Our management has a meeting planned to discuss all of this and Bryan will be posting this afternoon in answer to your questions. Please bear with us during this transitional time.

 

I am still waiting on the answers from yesterdays meeting here...

 

It´s just so easy to decide what would be the right thing to do.

 

1. Set a basic price before VAT equal for everyone (EU, US, Timbuctu, etc.) IMPORTANT: make it sufficient so you can cover your costs and even earn some money with it too.

2. Charge everyone the proper VAT that´s applying for them individually

3. Give the customer the choice to be charged in $ or local currencies

4. Communicate it in a nice, open and honest way

 

After these easy to accomplish steps everything will be fine

[+germanybert]

So nice to be an American living in Europe for 20 years and get to pay in USD and pay NO TAX. I don't really mean this my European geocaching brothers and sisters. I think you are getting a raw deal and it sucks to be so blatantly lied to.

[+Chapeman]

I hope, that the meeting will end with

1) an apology for the confusing and wrong informations

2) an apology for deleting posts at facebook

3) giving us correct informations

4) and if necessary to increase the Premium-Membership-Price (but worldwide! and not only for special countries.

 

If there are reasons, to increase the price, o.k. But please don´t think europeans are stupid, just because they are going in the woods to look for tupperware :-)

Edited April 19, 2013 by Chapeman

[+Chapeman]

So nice to be an American living in Europe for 20 years and get to pay in USD and pay NO TAX. I don't really mean this my European geocaching brothers and sisters. I think you are getting a raw deal and it sucks to be so blatantly lied to.

 

Thanks for your solidarity :-)