Fylde firm hit by shock Brexit charges for small traders sending goods to EU

Toys company Kiddimax has found that its sales to EU countries have plunged by around a third after prices had to be raised due to new VAT and tariffs and extra red tape, despite Britain’s much lauded trade deal with the EU.

Andy Tauber, owner of Thornton-based Kiddimax which supplies toys across the world through online sites such as Amazon and Ebay, said costs had rocketed since the start of the year as items costing more than 22 Euros now were subject to a 20 per cent import VAT.

Kiddimax exported toys worth £600,000 to France, Italy, Spain and Germany last year but most of its stock is made in China and therefore now attracts tariffs when sent to the EU.

Now because of the extra cost it has to pass on to customers, sales to EU countries have fallen by around 90 per cent.

He said: “If this carries on it will cost £500,000 to our business. Sellers like us feel that we have been unfairly treated with all this talk about a Brexit deal.

“And a lot of small sellers will not have known anything about this. All we can do is try to increase sales in the UK and the USA to compensate.”

Kiddimax was founded 13 years ago and employs eight at its Butts Road premises.

He said: “The only way round customers getting the import VAT charges and customs charges is to send the items by DDP (delivery duty paid) courier service, which alone costs more and is where the seller pays all duties and customs charges.

“But this in turn will have to be passed on to the customer increasing prices by a considerable amount making it harder to compete.

“The top and bottom of it is UK products will have to be increased for EU customers, a lot of businesses that have built a EU customer base will struggle, I feel and I know many other sellers feel the same, the Brexit deal is as good as a no deal regarding trading with selling to the EU.”

Tax advice service Avalara, said around 150,000 UK businesses that sell on online marketplaces have been hit with the higher costs.

And it added that sellers who used to just use their UK VAT number may now have to register for VAT in each EU country they sell into, thus incurring extra costs.

A government spokesman said: “The government will continue to work closely with businesses to ensure they are able to trade effectively under the new rules.”

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