Thread Rating:
  • 0 Vote(s) - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5
US Dutiable Entry
#21
(10-28-2016, 11:01 PM)SparkE Wrote: ...because EM won't have to collect VAT on SOLOs shipped to the U.S.
But they will.

The VAT (Value Added Tax) is "collected" as the vehicle is being built. That's why, in most cases, the advertised price includes the VAT tax.
It has more to do with the construction (Adding Value at each major step) than it does with the actual sale to the end user.
So, in that respect, the Canadian government (I don't know if federal or provincial) is entitled to that tax.

The vehicle is advertised @ 19,888 CAD. The $15,500 USD was due to what the exchange rate was then.

If it's now $14,8??, then that's what we'd pay in the US plus state tax if we bought it now.
It should be $19,888 x the current exchange rate + state tax at the time of purchase.

If I understand it all correctly. And if I do, the VAT and the state sales taxes aren't compatable, and have nothing to do with each other.

I don't feel that I'm getting pronged.
The Canadian government(s) is/are entitled to tax on the value added as the value is added (wholesale value).
The US states are entitled to their sales tax because it's a tax on the retail price that the end user pays regardless of what it costs to make.
The VAT is considered to be part of the cost to make the vehicle as I understand it. There is always value added between wholesale and retail however.

I agree that if you disregard the exchange rate factor, a Canadian will probably end up paying less overall...
Simply because of our added on state sales taxes. At a purchase price of $15,000, the 6% tax would be $900. So be it. IMHO...
I don't think there's going to be any adjustment even though most of the CA VAT has been "collected" and payed by Electra Meccanica before exportation.

I'm still not clear about how importing the Solo into other countries with their own VAT will work.
I still think that Canadian government(s) is/are still entitled to the majority of the VAT in those cases...
But I seem to remember that there are guidelines for computing the final added value (between wholesale and retail)...
And there are agreements (country by country) for the adjustment of the VAT "collected" and paid by Electra Meccanica.
In other words, in a lot of cases, those in countries with VATs may have to pay no, or little, VAT on top of the advertised price.

Again, I may be completely wrong on all of this, but from what I've read, that's my take on it.
Required listening... House of Lords - Can't find my way home
This version kicks. There's just no other way to describe it. Shivers. Turn...it...up!
Disclaimer: No false statistics were supported, displayed or harmed in the making of this post.
Reply
#22
Dale, I'm not getting paid for tax advice on this, so I'm not going to put in the research that I used to. I believe that you are either wrong or missing important details. From my observation, comparable products are consistently higher priced in Canada than in the United States, in excess of the exchange rate differential. Perhaps that may be due to those pesky unknown details, but I strongly suspect that it may hold true for the Solo as well.
I'm done.
[+] 1 user Likes flying_solo's post
Reply
#23
(10-29-2016, 12:23 AM)flying_solo Wrote: Dale, I'm not getting paid for tax advice on this, so I'm not going to put in the research that I used to.  I believe that you are either wrong or missing important details.  From my observation, comparable products are  consistently higher priced in Canada than in the United States, in excess of the exchange rate differential.  Perhaps that may be due to those pesky unknown details, but I strongly suspect that it may hold true for the Solo as well.

Yep, I'm just now reviewing what little I can find about the GST and HST taxes that have replaced the old VAT system. I think your observation is correct, but I also think that part of the reason that those prices are higher is that Canada imports a high percentage of it's goods from other countries and the GST and HST tax rates alone are brutal. We're talking 5% to 15% and sometimes even higher, again, depending on the type of goods or services, juristictions and various circumstances. As compared to our average 6% and occasional added municipality 1% and 2%.

Regardless of that, I'm finding no clear answers at all. Under the old system the manufacturer did put aside VAT funding at each significant level of mfg. and assembly.
The rules on goods and services appear to be so numerous and varied, I don't even know where to begin. I think the reason I'm unable to find anything on the commercial exportation of vehicles from Canada to the US is that there are so few Canadian vehicle manufacturers.

Bottom line is that it appears that now, in some circumstances and for some types of goods, the end Canadian user pays the added-on GST and/or HST at the time of purchase and in some circumstances the mfg pays them. Some exports appear to be tax exempt under certain circumstances and some not, again under certain circumstances.

So... I'm completely baffled and don't have the proper information for a short answer. I have a link to a document that's 828 pages long though.

I'm posting it and that's the best I can do for the next few  days.

http://www.ey.com/Publication/vwLUAssets...-guide.pdf

I guess we can disregard my entire last post as that information on the old VAT system  is no longer relevant.

Totally off the subject but interesting non-the-less...

I was on a UK Motorcycle site yesterday and one of the gentlemen I was posting with was amazed that I only paid $135 USD a year to insure two motorcycles.
He proceeded to tell me that he had to pay a road tax of $88 EU a year and insurance of over $2300 EU per year for one motorcycle. Now that's brutal.
The exchange rate is within 10%. It's presently $1USD = $.91 Euro.
Required listening... House of Lords - Can't find my way home
This version kicks. There's just no other way to describe it. Shivers. Turn...it...up!
Disclaimer: No false statistics were supported, displayed or harmed in the making of this post.
Reply
#24
My limited research indicates that Canada's value added tax is calculated and added to the buyer's statement at the time of purchase.  My understanding is no Canadian value added tax on exports so no added value impact on the Solo's Window Sticker price delivered to the USA.  

Solo's that are imported to countries that have a value added tax may be required to pay their countries value added tax rates at customs when bringing the vehicle into the country or at the time of vehicle registration and licensing.  My 2 cents.  I could be wrong.

If you buy a new or used Solo in Canada and drive/trailer it home to the USA expect to pay the tax at the Solo dealership.  My understanding there is a tax rebate form that needs to be filed within 60 days of purchase for a tax refund.
White Hot Solo #166
Reply
#25
Rick, the `tax rebate form´ is commonly only used by customers who purchase a product from a retail outlet. They pay VAT/sales tax and reclaim the amount at the point of exit. Goods that are exported by the manufacturer are commonly exemt. The importer then has to pay import duty and VAT/sales tax on arrival of the goods. It would therefore be of some interest for non-Canadian purchasers to find out whether they are expected to pay the VAT/sales tax twice: first in Canada, and then in their own country.
Reply
#26
There is no Canadian VAT on Canadian exports.......so my understanding is if ElectraMeccanica ships a Solo to my USA front door there is no applicable Canadian VAT added to my purchase price. Fortunately, there is currently no VAT in the USA.

My understanding is that as a USA Solo purchaser I pay only the potential 2.4% motorcycle import duty (it sounds like a duty free Canadian import based on US customs info) and a 6% State Sales Tax when I register and license the Solo motorcycle.

I'm guessing you will pay any applicable EU VAT and Sales taxes on the Solo import.
White Hot Solo #166
Reply
#27
(10-28-2016, 12:44 PM)Rickb Wrote: A future Solo Owner is going to pay any applicable State sales tax when and wherever they register and license the vehicle.  6% in my State of Idaho,ho,ho.

6% same here in Tennessee for register,tag and show proof of insurance with title or bank note. When EMV sales exceed $500,000 in Tn. EMV must to register with Tn. Gov.

https://www.tn.gov/assets/entities/reven...s17-01.pdf

My motorcycle insurer is investigating the cost of insurance for the Solo now. I gave her the information I have about cost and the web and forum site. She said she is excited about being the first one in Tennessee to insure the Solo.
Welcome to The Solo Owners and Future Owners Forum.
Ready for #695
[+] 2 users Like Lynn D's post
Reply


Forum Jump:


Users browsing this thread: 1 Guest(s)