Friendly Shipping: Customs Charges Vs Sales Tax for Independent Games Designers
Many Kickstarter projects advertise International Friendly shipping, there are two methods to achieve this claim. Firstly, you can use a fulfillment shipping company based in the country in question. This method is safe, however smaller Kickstarter projects may find the logistics required to be expensive or impossible. This is because manufacturers may be unwilling to split a single pallet for delivery to various countries and projects with less than 1,000 backers or that generate small box games will not create a second pallet naturally. Those that will ship to various countries will charge for the privilege. For example if you have only 10 copies going to Australia the price of using an Australian fulfillment company may well be prohibitive, leading many people to attempt the second method.
The second method is to ship units to a country with a price level which will not attract import charges, this method is possible for some countries, inevitable for some but effectively impossible for others. The major problem and source of confusion on this issue seems to be between customs charges and local taxes (such as VAT or sales tax). Customs charges tend to only kick in at quite high levels, £135 in the UK, $800 in the US and AUS$1,000 in Australia, for example. This is because customs charges are intended to target businesses importing stock not private shoppers. However, to suggest how complex this issue can be, it is possible to ship friendly to the UK by this method, inevitable to the US and technically impossible to Australia. The reason for this is local taxes. Taking the UK as an example (partly because with Brexit looming this might be very relevant information in the near future); customs charges kick in on imports to the UK at £135, but VAT is leveled at