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General discussionRegional Priced Games on GOG(2343 posts)(2343 posts)
(2343 posts)
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This is my favourite topic
Posted November 06, 2014
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Reaper9988: In theory anyone selling digital goods/good to a customer in the EU has to pay the countries VAT, in theory you have to register before allowed to sell in the EU.
I say in theory because smaller non EU businesses with offices in an EU country don't bother to register usually and they are seldomly gone after if ever.
Alot of small payment providers doesn't charge VAT either.
GOG is incorporated in Cyprus. As far as I know, they have to pay VAT on all European purchases.
Posted November 06, 2014
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Reaper9988: Vat rate depends on the EU(Not european in general) country the customer resides in.
http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/how_vat_works/rates/vat_rates_en.pdf

In theory anyone selling digital goods/good to a customer in the EU has to pay the countries VAT, in theory you have to register before allowed to sell in the EU.
I say in theory because smaller non EU businesses with offices in an EU country don't bother to register usually and they are seldomly gone after if ever.
Alot of small payment providers doesn't charge VAT either.

The time I cared looking up Vat was a few years back so this might have changed somewhat since then.
Yeah that was how I remembered it was actually. Thanks for the link. So it is not a flat 20% for every country which is in Europe.

But at the moment I am looking at some confusing thngis regarding which VAT actually applies.. where the customer is living are where the seller is, which would be gog in cyprus...
Post edited November 06, 2014 by moonshineshadow
Posted November 06, 2014
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HypersomniacLive: Perhaps in Canada and the US, but it's already included in the shelf-price in the EU, i.e. what you see is what you pay at the counter.
Hmmm, I didn't know that. That certainly seems like a less confusing way to do it. Maybe GOG should include VAT and have a * at the bottom?

* Price includes VAT for YOUR COUNTRY

On the other hand, it'd be super-confusing on the front page.
Post edited November 06, 2014 by RocketBearGames
Posted November 06, 2014
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Reaper9988: In theory anyone selling digital goods/good to a customer in the EU has to pay the countries VAT, in theory you have to register before allowed to sell in the EU.
I say in theory because smaller non EU businesses with offices in an EU country don't bother to register usually and they are seldomly gone after if ever.
Alot of small payment providers doesn't charge VAT either.
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RocketBearGames: GOG is incorporated in Cyprus. As far as I know, they have to pay VAT on all European purchases.
Sorry wasnt answering in particular to your game heh.

Gog pays Vat, I'm fine with paying up to 19% extra since that is german VAT, usually the conversion is much higher though.
Although for GoG it probably makes no difference as they hand out gift cards for the extra difference.
Posted November 06, 2014
In this discussion elsewhere on the boards, there were always people saying, that since GoG makes it's transactions through Cyprus, that the VAT from Cyprus is used for wherever you buy the stuff from, is this right?

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RocketBearGames: Honestly, it's not something that's well thought out.

On Steam, I use their recommended prices - they have a billion currencies these days and it's too hard to set them individually. I just set the US price and Steam does the rest. My understanding is that Steam has lower RUB prices because of lower median incomes in Russia.

For GOG, I just asked them to match the Steam prices.
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mrkgnao: I understand.

To the best of my knowledge, the median income in Russia is not that low. Dependent on the metric used, Russia is at around #50 out almost 200 countries. It is much higher than almost all the African countries (that pay the US price). It is also higher than quite a few countries that I believe pay the high European price (e.g. Bulgaria, Romania).

The common belief is that the low Russian price is a reward for the high piracy prevalent there, although I am not entirely convinced.
+1

And I may add, that average income in a country has huge diversity depending on the region, not to mention that even your neighbor could earn 5 times as much as you and this whole reasoning with poor Russia is full of fail from the start.

I earn slightly less than the average Russian, welcome to Eastern Germany.
Basing a price system on national discrimination which is mostly based on prejudices is so wrong.
Charging the Balkan states as much as the rest of Europe is wrong anyway.

VAT in Germany is 19%, not 20.
Post edited November 06, 2014 by Klumpen0815
Posted November 06, 2014
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Klumpen0815: In this discussion elsewhere on the boards, there were always people saying, that since GoG makes it's transactions through Cyprus, that the VAT from Cyprus is used for wherever you buy the stuff from, is this right?

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mrkgnao: I understand.

To the best of my knowledge, the median income in Russia is not that low. Dependent on the metric used, Russia is at around #50 out almost 200 countries. It is much higher than almost all the African countries (that pay the US price). It is also higher than quite a few countries that I believe pay the high European price (e.g. Bulgaria, Romania).

The common belief is that the low Russian price is a reward for the high piracy prevalent there, although I am not entirely convinced.
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Klumpen0815: +1

And I may add, that average income in a country has huge diversity depending on the region, not to mention that even your neighbor could earn 5 times as much as you and this whole reasoning with poor Russia is full of fail from the start.

I earn slightly less than the average Russian, welcome to Eastern Germany.
Basing a price system on national discrimination which is mostly based on prejudices is so wrong.
Haha I like Russia it slaps the "we must raise prices because of piracy" so in the face ;D
Posted November 06, 2014
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RocketBearGames: Honestly, it's not something that's well thought out.

On Steam, I use their recommended prices - they have a billion currencies these days and it's too hard to set them individually. I just set the US price and Steam does the rest. My understanding is that Steam has lower RUB prices because of lower median incomes in Russia.

For GOG, I just asked them to match the Steam prices.
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mrkgnao: I understand.

To the best of my knowledge, the median income in Russia is not that low. Dependent on the metric used, Russia is at around #50 out almost 200 countries. It is much higher than almost all the African countries (that pay the US price). It is also higher than quite a few countries that I believe pay the high European price (e.g. Bulgaria, Romania).

The common belief is that the low Russian price is a reward for the high piracy prevalent there, although I am not entirely convinced.
The problem with that reasoning is double:

a) There are countries in the EU price zone that have income levels at the level or under the level of Russian income. So, why does Bulgaria pay the strong price then ? Where is that "fair purchasing power" consideration for say, Greece , or Romania ?

b) Russian income varies widely between West / East, Large cities, vast spaces out there, Oligarchs / Middle class/ working class. In fact games are likely to sell mainly amongst the middle class , I suppose. So putting that low price as " the only way for them to buy it" is a bit.... too mainstream thinking.

The only fair way to treat customers is one world base price + VAT charged separately when applicable.
Posted November 06, 2014
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Reaper9988: Haha I like Russia it slaps the "we must raise prices because of piracy" so in the face ;D
Yes it does, it shows that piracy helps you reducing the price for your fellow comrades, lol.
Posted November 06, 2014
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Phc7006: The only fair way to treat customers is one world base price + VAT charged separately when applicable.
That's how I do it via my own site.
Posted November 06, 2014
Has anyone a reliablel source saying if VAT has to be paid according to the consumers country or according to the country the seller (aka gog) is located? Since I am finding infos on the internet which say either one or the other and one must be false^^

If the VAT is charged according to the country gog is in, then your prices for Infested planet are ok for Europe since the small difference is probably just the rounding to fit the game into gog pricing schemes.
But the sad truth is, sad most of the time regional prices are not just added taxes but a lot more.
Post edited November 06, 2014 by moonshineshadow
Posted November 06, 2014
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Phc7006: The only fair way to treat customers is one world base price + VAT charged separately when applicable.
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RocketBearGames: That's how I do it via my own site.
Just out of curiosity, do you pay VAT to the EU ? Or do you use a big Provider like BMT Micro which does it automatically ?
If it's not done automatically it is much more honest than most any small out of EU business heh
Post edited November 06, 2014 by Reaper9988
Posted November 06, 2014
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Reaper9988: Just out of curiosity, do you pay VAT to the EU ? Or do you use a big Provider like BMT Micro which does it automatically ?
If it's not done automatically it is much more honest than most any small out of EU business heh
I use BMT Micro and they handle all that stuff for me (in exchange for 9% of the money).
I'm not an accountant - I make games, so the less time spent doing taxes the better.
Posted November 06, 2014
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Phc7006: The only fair way to treat customers is one world base price + VAT charged separately when applicable.
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RocketBearGames: That's how I do it via my own site.
When you insist on adding VAT to the prices GOG has to compensate out of their own pocket (due to their fair price policy) the European costumers for paying a higher price than people in the US. I don't think that is fair to GOG.
Posted November 06, 2014
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moonshineshadow: Has anyone a reliablel source saying if VAT has to be paid according to the consumers country or according to the country the seller (aka gog) is located? Since I am finding infos on the internet which say either one or the other and one must be false^^

If the VAT is charged according to the country gog is in, then your prices for Infested planet are ok for Europe since the small difference is probably just the rounding to fit the game into gog pricing schemes.
But the sad truth is, sad most of the time regional prices are not just added taxes but a lot more.
If you find that GOG pays only the Cyprus rate, please let me know and I'll ask them to change the price.

I suspect that it's otherwise, though. I know even my friends on Canada who sell on the Android store have to pay VAT per-country. They don't even have any offices or anything in the EU.
Posted November 06, 2014
bleh
Post edited November 06, 2014 by Reaper9988
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This is my favourite topic
Community
General discussionRegional Priced Games on GOG(2343 posts)(2343 posts)
(2343 posts)