posted on July 16, 2001 11:44:32 AM
I am a buyer from Canada, and TWICE this month have had to pay extra in duties due to the over-valuation of the product (more than I paid) on the customs slip.
These items were shipped small packet, uninsured, so the valuation would not have been increased for insurance purposes. So why would a seller do this?
In the first incident, the seller included the shipping amount (which was fairly high) in the price on the customs slip, and I had to pay duty whereas if the price of the item only was on the slip, I would not have had to. BTW, Canada Customs auctomatically tacks on a $5.00 handling charge when customs charges are assessed, no matter how little the value of the item is over the duty free amount.
The second incident, a package I picked up at the post office today, was a doozie....I paid an extra $10.00 in duty because the seller valued the item at $50.00 rather than the $15.00 I paid (a video tape). Geezzzz...
Anyway, here is the letter I just sent the video tape seller - if you had been this seller, how would you receive this letter, and how would you respond/deal with the situation?
Hello XXXXXX
I received the video tape: XXXXXXXX auction #XXXXXXXX today.
One aspect of the transaction was very troubling (and expensive) for me. On the customs slip, you indicated a value of $50.00 for the item. Canada Customs increased it to $75.00 Cdn. (due to the exchange rate) and I WAS ASSESSED DUTIES ON $75.00 Cdn! The total amount I had to pay in duties, due to the inflated and incorrect amount shown on the customs slip, was $17.00 Cdn (aprox. $11.50 U.S.).
I don't understand why the customs slip did not say $15.00, which is the price I paid for the video. Also, as this is very close to the allowed limit for duty free, It may well have gone through customs without even a charge. Even If they had decided to charge, it would have been aprox. $7.00 Cdn, (aprox. $4.70 U.S.) not the $17.00 Cdn. that I was charged.
I am unhappy about having to pay an extra $10.00 Cdn. (aprox. $6.80 U.S.) because the item was over-valued on the customs slip. I am hopeful that you, as a reputable seller, can address this error and propose a solution.
Thank you in advance,
XXXXX
A Note to all Sellers who sell internationally - please put on the Customs slip only what the buyer paid for the auction, not including the shipping amount, and certainly not an inflated amount, even for insurance purposes. It can mean significantly more cost in duties for the purchaser, and anger (and rightfully so, IMO) a person who might have been a repeat customer otherwise.
I think it is more carelessness than anything else. Sellers are so used to insuring stuff for $50.00 (the maximum for the minimum amount of postal insurance) that we all kind of automatically respond $50 when asked value.
I personally had no idea you guys got whacked that much for customs fees. I will certainly be VERY careful when completing the forms for items I ship to Canadians.
Thanks for the heads up.
Gerald
"Oh but it's so hard to live by the rules/I never could and still never do."
That is an excellent letter. I hope your seller takes responsibility for this and reimburses you for the unnecessary customs duty. Good luck, and keep us posted.
posted on July 16, 2001 12:07:30 PM
Thanks for that information, Gerald. It may well have been a case of "force of habit". And thank you for being careful of the valuation you will be placing on the customs slip to Canada. It will be much appreciated by the Great White Northeners!
Gerald, if you were the seller of the video that I purchased, and received my letter, how would you handle the situation?
Just FYI to U.S. Sellers - Canadians can be hit with duty on any amount over $10.00; I have had some slide by (especially smaller packages) up to about $15.00, but beyond that I've always had to pay duty which is a minimum of $5.00 handling fee plus the duty.
posted on July 16, 2001 12:14:12 PM
Obviously, the solution is for the BUYER to refuse shipment if ANYTHING is in error. Since the item was overvalued (and thus costing you more) you had the choice to refuse.
Clearly, the seller was not doing anything malicious in this regard -- he doesn't profit from the error. It was, as has been stated, most likely an error due to not knowing the rules on such.
I don't think the seller owes you a refund as much as an no-fault apology and a chance to make it up in the future.
I do appreciate your calling it to our attention. I just sent a package to Canada today and overvalued as well (by about $5). While I love Canada, shipping there can be such a hassle, that I normally don't do it.
Most items valued under $20 Canadian are GST Free. The amount has nothing to do with Duty, as many items are Duty free since NAFTA rolled out years ago.
Also, with regards to GST - $20 Canadian is the cut off point for merchandise, and $60 Canadian is the cut off point for Gifts.
I'm not sure why $10 items would be charged GST or PST???
FYI - In the future it might be a good idea to let your non Canadian sellers know in advance to shipping that only the high bid amount should be put down as "Value" on the Customs forms.
It's very difficult for ALL International sellers to know ALL the various tax rules & regs of each & every country they ship to.
In this case the seller screwed up, and I'm sorry you got dinged the extra amount.
posted on July 16, 2001 12:19:40 PM
I can easily see sellers who include the shipping cost, since the customs form doesn't define "value". Its actually not unreasonable, in the absence of a clear definition, to define value as "total amount paid", which would include shipping. I always use "final bid amount", but I just decided that on my own, with no "help" from the PO.
One suggestion for all international purchases: be proactive. When communicating with the seller, tell them to put the right amount on the slip. You know its coming, might as well give them as much help as possible in filling it out correctly. You'd want to this in as subtle a way as possible, but most sellers should be amenable to helping out their customers in any legal way they can.
As a seller, i'd be sending you a refund, unless I somehow had an explanation of why I was right in filling out the form the way I did. Otherwise, I made a mistake, and would need to fix it, and really the only way to fix this would be a refund of your excess charges (the $10).
The reason I didn't refuse the package - I felt that if I did, I was risking losing the $21.00 U.S. ($15.00 + $6.00 shipping) (aprox. 30.00 cdn) that I paid for the video with no video to show for it, which is far more than the $17.00 in duty. If I had to lose one amount, it would be the extra $10.00 cdn. for the duty instead of the $30.00 for the video, as there would be no guarantee that the seller would refund the money on return of the video. Also, regarding shipping to Canada - I'm not clear on why you would consider that putting the bid amount on the customs form would be considered a hassle?
Kiawok,
I was told by the Post Master at our Post Office that $10.00 is the limit before duty is assessed. She actually told me (I can't believe she said this....) to ask the sellers to put no more than a $10.00 value on their slips. I would never ask this of a seller, nor would I ever ask that they put on "gift". All that I ask is that the correct value be placed on the customs label, as I do factor the resulting duty into the cost of the item when bidding. Also, Kiawok, what my PM said has also been my experience - I am usually paying duty on amounts above $15.00, and sometimes even just above $10.00.
Captainkirk - that is a good idea about being pro-active - I will start doing this on every purchase; just a very informal, kindly worded reminder to put the exact bidding value on the form.
Thanks again, all - lots of food for thought. I will let you know if I receive a reply from the seller and what he says.
If you still have your Postal slip, take a closer look at the charges. The amount you were charged for Duty will be nothing, or next to nothing, and you'll find the majority of the fees were for GST/PST.
Some items [non North American made items] will indeed have Duty tarrifs, but on the vast majority of items being imported in to Canada, the majority of the fees involved are for GST.
I'll go & try & find the link to the info you & your Postamaster need.
posted on July 16, 2001 12:49:45 PM
BTW - Read the bottom portion of this page.
If you print off the auction page, and submit it with the refund form, you just might get the extra amount you paid returned to you by Canada Customs?
If I were the seller I would just send the money back to the buyer, remember the lesson and be done with it. But I've learned from spending enough time on these types of boards that what I would do (as a hobbyist seller) ignores lots of real world realities for those who make their livings selling on line. If I did, I might work to pursue all remedies that didn't involve money out of my pocket. As it is, giving the customer back his money would be the "cheapest" way out for me.
Gerald
"Oh but it's so hard to live by the rules/I never could and still never do."
posted on July 16, 2001 01:25:42 PM
Thank you so much, Kiawok, for the links and the time you have taken to research and post them. I will be taking them to the P.O. to inform her that it is not $10.00 U.S. where fees are assessed, and that it is GST & PST and Handling Fees, not duty.
I guess the fact remains that I wouldn't have been paying those fees if the amount on the customs slip had been correct. I will investigate getting a refund through Customs Canada, as you suggested, Kiawok. If I receive a refund from the seller and then end up with a refund from Customs, I will be returning it to the seller, as it would be his refund then.
posted on July 16, 2001 01:34:44 PM
Thanks for your answer, Gerald! I too am pretty generous with making things right for my buyers, and see this less and less on ebay so I really don't know what to expect from this seller.
I'd even be happy with free shipping on another video (with the CORRECT amount on the customs slip this time! lol). This would ensure a video sale, and since I paid $3.00 above the actual cost of shipping on this one, (I paid $6.00 - postage was $3.00) he should really not be out of pocket at all!. Note - He had no cost of shipping materials as he even turned a USPS Priority Video Mailer inside out to ship it. Now THAT must have been tricky - those boxes are on the small side! If I tried something like that, I would slice my hand open for sure sawing through the heavy cardboard on that small of a box in order to reverse it! hehe.
I hope he does offer a free shipping on a video - this could be a win-win for both parties.
yup, i'd said force of habit and/or ignorance. i thank you for posting this, because i didn't know either and am just about to ship an item to canada! i'd feel terrible if i caused my buyer to overpay. while i wouldn't have inflated the price, i might well have included the shipping in the value. this is my first time shipping to canada.
You misunderstood me. I didn't say writing one value on the form was a hassle. The entire shipping effort is a hassle -- this isn't against Canada (I love the place), it's a function of shipping outside our borders.
Most of my shipping is priority mail -- I can prepare everything at home. I could probably prepare everything for a Canadian shipment too, but I don't have all that many, so why bother.
Also, using PM, I have boxes for free. Cannot do that with Canada, gotta prepare it all myself.
And then there is the additional customs form that has to be filled out. Takes extra time.
No, I don't think writing the correct number IF you're going to ship US->Canada is the hassle. However, I think it's the buyer's duty (no pun) to make sure the seller is aware of any special circumstances to ship to their country since it will only affect the buyer and not seller (paying extra fees).
For the record, I'd say the same if I lived in Canada shipping to the US. It's the border issue, not the country involved.
Definitely remind them to only put the value of the item itself in the box -- I figured that was obvious, but good of CaptainKirk to point it out.
Regardless, in the situation you described above, I still don't see where the seller owes you a refund.
posted on July 16, 2001 02:08:34 PM
Glad I could help, KittyX3!! I'm sure your buyer will appreciate having the correct amount on the customs slip, as all taxes and any duties assessed are based on that amount. And believe me, our taxes are hefty! First, 50% is added to the cost on the slip due to the poor Canadian dollar and high exchange rate, then on THAT amount, if it is over $20.00 (not $10.00 - I was recently corrected); THEN A full 15% (in Ontario) of that higher amount is charged in taxes. And don't forget the $5.00 "handling" fee on top of all of that! Blah!!
I think what happened to me happens more often then we hear about. In the first incident where the seller included the shipping and I had to pay the taxes and handling whereas I would not have without the shipping, I didn't bother to contact the seller or write anything to the boards; I thought it was a fluke and wouldn't happen again - I was incorrect!
I'm glad I can assist other buyer/seller transactions and possibly help them avoid future disagreements and problems by bringing this situation to light. All the best in your forray into selling to your northern neighbours, KittyX3! I hope all your transactions there are memorable (in a good way! lol).
posted on July 16, 2001 02:11:17 PM
Great thread!
I am shipping two things to Canada and two to Japan today, I was wondering how much to put for the value. I will put what was paid at auction. I usually don't sell internationally (even if offered in the auction), but my last batch of auctions appealed to a worldwide audience (my pillsbury doughboy collection).
posted on July 16, 2001 02:37:56 PM
Just for interest, I've heard all of the following proposed as the "right" amount for the value in a customs form (in no particular order):
1. Final Bid amount
2. Bid plus handling
3. Bid plus shipping and handling
4. Insurance value
5. Current replacement value
6. What seller actually paid for it
7. #6 plus storage and selling costs
To be honest, one could make a pretty good case for all of the above, depending on what, exactly, the customs people wanted in the form...
posted on July 16, 2001 02:47:13 PM
Barb,
I am very glad you posted this info as I was "in the dark" so to speak and did not know about it before reading the thread. What happened with your seller? Did (s)he offer you some sort of a compromise? I hope so!
posted on July 16, 2001 03:43:04 PM
Hi Captainkirk,
The P.O. was very clear to me on that one when I asked as to what amount should have gone on the slip - it is what the buyer paid for the item, excluding shipping. That IMO is also what makes the most sense as well. Why would one want to inflate the value beyond what the customer pays? Of what purpose does that serve? On commercial purchases, I have only ever paid taxes/duties on the cost of the items.
If one was insuring the item, one might consider cost of replacement in order to maximize the refund in case of loss or damage, without fibbing about its value. This of course would mean higher duty/taxes, therefore, that decision should be the buyer's as they would be the ones receiving the refund in case of loss/damage, and they may or may not appreciate the inflated values leading to higher duties and taxes in order to recoup more money in case of loss or damage.
If I was given the choice, I would say DO NOT inflate the value to cost of replacement for insurance purposes - there is only a SLIM chance of loss or damage, but the duties/taxes is a SURE thing!
BTW, can someone tell me what the maximum amount is into the U.S. from Canada before duties and/or taxes are assessed? I usually am not concerned as I only put on the worth of the item, however, it still would be nice to know if my buyers are going to be hit with these extra costs or not. Thanks!!
Hi Ashlandtrader -
Regarding the seller of the video - I have not heard a word as yet, and my gut feeling is that I won't hear anything at all. I have only expressed my unhappiness about a transaction in one other instance, where I received an item different than the one that was in the pic; I never heard back from that seller either.
It is a shame - I am sure some buyers would just say "to heck with it, ebay's not worth it anymore" and just not come back. It is in all sellers interests to do the right thing for their buyers, even if, as peiklk says - he doesn't "owe" a refund; however, ethically it would be the right thing to do as his error, whether deliberate or not, led to additional, unnecessary costs for me. The satisfactory resolution of an instance such as this is the kind of thing that keeps bidders staying on the site and comming back as repeat customers; it is the ignoring of such things by sellers that turns buyers away from them and potentially leads to their exit from eBay.
I guess my point is that YOU chose to go ahead and pay those fees to get the package -- even if you knew them to be incorrect.
The "right" thing would be to refuse it and have him reship with the correct valuation. You would have had to wait longer, but everyone would have been better off financially.
While his mistake caused your PO to charge you more. YOU had the right to not pay those fees as well. Otherwise, YOU spent HIS money.
According to the Canada Customs & Revenue Agency, and the US Customs, the Value of an item is the amount paid for the item, and does not include shipping/insurance/handling etc.
posted on July 16, 2001 04:33:50 PM
I seem to remember reading about only marking the value as the price paid on the USPS site somewhere (don't ask me where). Now if I could just get international buyers to stop insisting that I mark everything under $10, I've actually cancelled a transaction recently because of this. Had to threaten the buyer with contacting his customs authorities if he negged me.
In this case the seller should reimburse the buyer and consider it a lesson learned.
posted on July 16, 2001 04:47:09 PM
Such a great post Barb. Again it comes back to our communicating with each other both as buyers and sellers doesn't it? After being stung once on a 10.00 item, that was supposed to be shipped by USPS, for some reason the sellers ( who by the way were great people) thought they were doing me a favour by shipping by UPS and putting price of I think I remember correctly 30.00 or 35.00 on customs form.
Now since UPS has their own brokerage their fee alone was 30.00 then duty and taxes and the bill came to around 58.00. The driver advised me to refuse which I did. I contact the sellers to let them know, Then when they got it back, I sent them the additional cost to repack and send by USPS. When I sell to U S customers custom slips show what they paid converted to Canadian just in case of loss etc. We can learn so much from each other. Off subject here but I have received priority boxes from U.S. I was under the impression that they were only used in U.S. is that correct. Joyce
posted on July 16, 2001 04:58:10 PM
My Customs Slip always lists the sale price on eBay converted to UK£ at current rate of exchange. Shipping costs are not part of the value of the lot.
posted on July 16, 2001 05:06:29 PMIn this case the seller should reimburse the buyer and consider it a lesson learned.
Or the buyer should eat the cost and consider it a lesson learned.
Really, it all depends on where you find the fault to be. This is not clear cut.
The wisest move would have been to reject the package. Since that was not done, a suitable compromise would be to split the costs -- since both would have some share. However, that would be out of the good graces of the seller.
I'm glad your PO folks were clear on it. Mine had no idea. Which is to be expected, since the quality of clerks varies by a factor of at least 100% from PO to PO.
I agree that there doesn't seem to be much reason to inflate the value on the customs form. In fact, of the 7 items I listed, many of them would be less.
My only point is that, especially for the casual seller of international items, when faced with the customs form, it merely says "value" and leaves it up the postal patron to put in the "right" value. And since "value" in a customs sense is not a concept that is in common usage in everyday usage with an agreed-upon definition, its not surprising that different people come up with different, reasonable seeming definitions. After all, when you are trying to figure out government forms, it isn't clear that the "most obvious" definition is the right one..in fact, sometimes the "right" one is the one that seems to make the least sense!
Just as an interesting discussion point, for example, if a seller charges $3 shipping and $2 handling, why shouldn't the handling be part of the "value"? After all, antoher seller might have raised the reserve/minimum bid by $2 as a different auction strategy, in which case the handling would have been part of the price. Either way, handling represents a profit to the seller, just as the bid amount does. So one could argue that handling could be part of the "value"...and how about if the shipping charged is more than the actual postage. Since that, too, is part of the profit of an item, maybe its part of the "value" too?
Again, I agree with your definition, but no one should be surprised when reasonable people end up with completely different interpretations of the word "value".
posted on July 16, 2001 05:36:44 PM
I do not think rejecting the package would have been the clear-cut right thing to do.
Buyer refuses package.
It gets sent back to seller. On long customs form it states "Item subject to return charges at sender's expense"
So now seller has item back, and possibly had to pay for it.
OK, now who pays for reshipping?
Buyer? They already paid once, and they refused.
Seller? They already shipped it once and buyer refused.
Either way, one of the parties is out more money.
Buyer is out more money since seller figures it was buyer who refused. So buyer might as well have paid the duties.
Or seller is out more money to reship because he figures it was his "mistake" .
If I was the buyer I would have taken the package. Maybe " extra" charge could be split, since both "errored"
If I was the seller, I would reimburse the fees and hope it is a goodwill gesture for future business.
Yes, it is impossible for sellers to know all the international laws of shipping, but sellers should know the difference between "value" and "insurance"
And there is no "insurance" on packets to Canada, only registered for an additional $7.25 fee and only good to $40.45. So there is no way seller could have "insured" it for $50.00.
Edited to add, there is no insurance on letter-post (under 4 pounds, old small packet), insurance is available on parcel post.
~Not barrelracer on ebay, don't pick on them!~
[ edited by barrelracer on Jul 16, 2001 06:10 PM ]
posted on July 16, 2001 06:00:59 PM
Hi barrelracer...now you've gone and confused me. I purchase P.O. insurance (up to a maximum of $675 value) on every item I ship to a Canadian buyer. It costs about $2.00 usually.
And the reason I said $50 is force of habit is because the cheapest U.S. domestic insurance is $1.10 for up to $50 of value which covers the vast majority of eBay sales. So when a postal clerk asks me the "value" (and since I sell junque), "fifty bucks" crosses my lips before I even know I've said it!
Gerald
"Oh but it's so hard to live by the rules/I never could and still never do."
