Amendment to legislation: Buyer’s liability for excise duties in online sales of alcohol products will increase in September
Tax Administration Bulletin, 8/26/2024In future, a private individual ordering alcohol products online may be liable for excise duties on the products together with the seller. In addition, the party liable for the duties must provide the carrier transporting the products with an identifier for the transport.
Starting in September, if you order alcohol products from an online store based outside Finland, you may have to pay excise duties on the beverages even if the seller arranges the transport of the products.
Before this, only the seller was liable for excise duties in situations where the seller arranged or helped arrange the transport.
This change is due to an amendment in legislation coming into force on 1 September. The Finnish parliament accepted the amendment in June.
The buyer’s increased excise duty liabilities concern orders made on or after 1 September
Buyers’ excise duty liabilities increase
Until now, excise duties have been the sole responsibility of the seller or a tax representative appointed by the seller in situations where the seller arranges the transport of the ordered beverages or otherwise influences the transport arrangements in any way. In these situations, the seller has acted as a distance seller.
After the amendment, the seller and the buyer may both be jointly liable for paying excise duties in instances of distance selling.
“It is still the distance seller’s responsibility to submit an advance notice to the Finnish Tax Administration and to pay a guarantee corresponding to the amount of excise duties on the products. However, if the seller does not file the advance notice or pay the guarantee, from now on the Tax Administration will send both the seller and the buyer an identical excise duty decision. Duties must then be paid according to this decision”, says Senior Tax Specialist Piia Lax from the Finnish Tax Administration.
According to the Tax Administration's estimate, most online stores selling alcohol products do not pay excise duties to Finland.
If the buyer arranges the transport of the products, they are solely responsible for the excise duties
If the buyer has arranged the transport of the ordered products completely independently without the seller’s involvement, the buyer is liable for the excise duties. In this case, the buyer must submit an advance notice to the Tax Administration and pay the guarantee. The guarantee corresponds to the amount of excise duties payable on the products.
You can submit the advance notice and pay the guarantee in MyTax.
Excise duties can double the price of the order
A customer who buys alcohol from an online store cannot be certain that the seller company will take care of its excise duty responsibilities in Finland.
There are no records in the Tax Administration's systems that would allow the buyer to verify that an advance notice has been filed and that the required guarantee has been paid.
“If the price of the product is significantly lower than the prices in Finland, there may be reason to suspect that no advance notice will be filed, no guarantee will be placed, and no excise duties will be paid to Finland. If you order alcohol from abroad online, there is always the risk that you may end up having to pay the excise duties on the products. This may even double the price of the order”, says Lax.
Example:
A 24-can (cans of 0.33 litres) cart of beer (4.6%) costs €13.90 at an international online store. The excise duty on alcohol is €13.15 for the beer, and the excise duty on beverage containers is €4.03 for the cans. The excise duties total €17.18, making the 24-can cart’s price €31.08 with duties included.
Carrier must be given an excise duty number from MyTax
After the new legislation has entered into force, the distance seller must provide the carrier transporting the products with the excise duty number that the Tax Administration has issued to identify the transport. The excise duty number is available in MyTax after the guarantee has been paid.
If the private individual who ordered the products also arranged the transport of the products, they must likewise give the identifier to the carrier. During the transport, the excise duty number must be presented to Finnish Customs or the Finnish Tax Administration upon request.
“The purpose of the identifier is to help identify the consignments on which excise duties have been paid correctly", says Lax.