Update: I lost this in my drafts folder for over a year!
I live in Iceland. It’s a nice place to live, but it’s small, so I often have to buy things from overseas, particularly in for hobby electronics gear, but anything small and cheap has this problem.
Now, let’s get this straight, I’m not complaining about customs or VAT. (Not today anyway) VAT here in Iceland is 25.5%, and is applied at the end, on top of shipping charges. Customs rate isn’t always as easy to work out.
Now, in this example, I bought a device from Texas Instruments, for $US4.99, or about 630 ISK. This was advertised as shipping included, worldwide. Add 25.5% VAT, 790 ISK. Not bad. So it arrived yesterday.
Now, what does that even mean? They’ve charged me ~473 ISK for “customs handling” It doesn’t seem to be anything like the VAT rate, or the VAT rate plus the customs rate. (FIXME – finish getting customs rate)
Customs officially don’t collect anything like this, they simply say that agents are allowed to charge for filing paperwork.
So, this seems to be some arbitrary amount they just felt like charging. Next we have 750 ISK for being “an unregistered customer.” Well, that sounds awesome. I didn’t choose this company, I ordered a product from Texas Instruments with shipping included. Who knows if it’s even possible to become a registered customer.
Then there’s VAT on those charges. So, a whole 120% charge (of original purchase) on being the wrong sort of customer and another 75% (of original purchase) for “handling”. I can’t actually see where they charge the VAT/Customs on the product itself, but the end result is that I’ve paid 170% of the original purchase ON TOP of the basic vat rate + the product price. (1345 ISK + 790 ISK)
How is this remotely reasonable for “shipping included” ? And who’s responsible? Texas Instruments clearly believes they paid FedEx, (or presumably FedEx wouldn’t accept the shipment?) I can only assume that FedEx delivers the package to Iceland, believing that they’ve been paid, but I have zero insight into what the deal is between the local agent (Hraðflutningar ehf)
I believe the party responsible is IceTransport. As they said earlier, local customs agents, defined here, are allowed to charge basically whatever they like. So they do. I presume they treat customers shipping outbound through them quite a lot better, but what are my options at the end of the day? I refuse to pay their arbitrary charges, they hold the parcel, and they’ve already been paid by FedEx/Texas Instruments? So they bin the package, and are already in front? Or do I just suck it up, and pay through the nose? They’re both distasteful.
Customs official answer on handling charges: