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I'm a Russian citizen. I've noticed that literally all online EU shops and service providers (e.g. web hosting) add VAT to the price. I've spent some time looking for an article that implicitly states that VAT should be paid by foreign non-EU citizens when shopping or purchasing services online but couldn't find one. What article or articles make this statement?

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    Citizenship is unimportant to this question. What matters is your location. Where do you live?
    – phoog
    Nov 18, 2021 at 9:22
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    It's a consumer tax. If you consume it in the EU, you pay the consumer tax. As a 3rd country, non-resident, national you can get it refunded when leaving. As a online shopper, the VAT may 'disappear' after giving a non EU address (i.e. it's being exported). Check the invoice before the final 'buy'.
    – Mark Johnson
    Nov 18, 2021 at 20:46

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Let's say I'm in the UK. I order something online in the UK for £120. In reality, the store calculated this as £100 + £20 VAT, and £20 of my £120 will be sent straight to HMRC (UK tax office). Since store and I are both in the UK, that's how they have to do that by law. (There are exceptions, but this is the most common case).

Now you are in Russia. The company is likely not much interested in a few sales to Russia. So they don't have to charge you VAT. But they will sell to you for £120, send you an invoice for £100 + £20 VAT, and send £20 to HMRC. Just as with my purchase. They don't have to do this, but they do, because everything else is much more complicated and not worth the extra work for them, and not worth getting fined if they do it wrong. You can try to get the money back from HMRC - good luck. The store won't help you; they don't have to, and it's extra work.

So in practice your choice is to pay £120 for the item, or to not buy it.

If you ordered 1,000 of these £100 + VAT item, you would likely convince them to do the extra work for a £100,000 sale. Or if you went to a store that sells lots of expensive items to tourists, where these sales make a significant portion of their total sales, and they know how to do this correctly.

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None. You need not pay VAT.

But the stores won't bother to configure excluding VAT for customers like you. They'd rather have the same setup for everyone, charge you "VAT" and pocket it (because they don't have to pay it for export sales).

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    It’s illegal to collect and pocket VAT in most jurisdictions - what is probably happening is that they are simply passing it on to the tax body with the rest of the collected VAT, which isn’t illegal.
    – user28517
    Mar 7, 2020 at 21:01
  • @Moo It is utterly naive to assume that something is not happening just because it is illegal.
    – Greendrake
    Mar 8, 2020 at 0:14
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    And it’s ludicrous to think that “something illegal must be happening” is the answer to everything. It’s not, however, naive to point out that that thing is illegal.
    – user28517
    Mar 8, 2020 at 0:37
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    @Greendrake In the UK, if a company charging VAT charges a particular customer VAT, then they must send a bill with a VAT number, and the VAT numbers must be consecutive. So it's difficult to pocket the money.
    – gnasher729
    Mar 8, 2020 at 15:59
  • You don't know that this Russian citizen "need not pay VAT." If the Russian citizen is in the EU, then the Russian citizen does need to pay VAT.
    – phoog
    Nov 18, 2021 at 9:25

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