NEW VAT RULES governing all items bought from non-EU countries come into effect today meaning Irish people face paying more for some of their online purchases.

The current VAT exemption for imported goods with a value of €22 or less will end today. This means that all goods arriving into Ireland from non-EU countries, regardless of their value, will be subject to VAT.

The VAT rate that will be applied will be the same as if the goods were purchased in Ireland.

Revenue also warned that the new rules will apply to goods bought from a non-EU country in advance of 1 July that subsequently arrive in Ireland for delivery on or after that date.

These new VAT rules ensure that goods imported from outside the EU no longer have a preferential VAT treatment compared to goods purchased from within the EU.

James Byrne is a director of e-commerce at Retail Excellence. He told The Journal that the rule change “levels the playing field” for Irish businesses and is ultimately a good thing for e-commerce in Ireland. 

He said: “On balance, it’s a levelling of the playing field. There will be short-term disruption as people get used to it. The removal of the exemption for VAT under sales of €22 is a good thing as well.

“There were things flooding in from Wish and China and from the US and they haven’t been liable for VAT. There were Irish retailers selling the exact same products and were being hit with this rate. That is being removed.”

The Irish consumer will either pay the added duty upfront or it might be collected by their courier who will act as the agent in some cases, Byrne explained. 

“It’s about getting used to it. It will take a while but it’s similar to Brexit. You might receive a text or an email saying you have outstanding VAT due and you can go on and pay it. People will adapt to it.”

Byrne said consumers should stay vigilant about texts and emails they receive and make sure they are dealing with legitimate firms. Several fraudulent text message scams purporting to be from couriers have been doing the rounds since last year. 

Maureen Dalton, from Revenue’s Customs Division, emphasised that consumers need to be aware of the additional charges these changes will bring when buying goods online.

She said: “Goods coming from non-EU countries are regarded as imports. This means the goods are subject to customs formalities and are liable to certain taxes and duties.

“Currently, if the cost of the goods you buy online, including transport, insurance and handling charges, is less than €22 you do not have to pay VAT. From 1 July, VAT will be charged and collected on all goods, regardless of their value.”

Dalton also reminded shoppers to be aware that these changes may mean that additional charges can apply once the purchased goods arrive in Ireland for delivery.

“If you shop online, you need to check whether the advertised price includes all tax and duty costs due before you make your decision to buy the goods concerned. If the supplier is operating a duty paid model, the total price paid for the goods at the time of purchase will generally include Irish VAT and any duties due meaning no further Revenue charges will arise on delivery.”