Sales Taxes? Maybe? Kinda?

Hi, new to the Patreon here. In Spain they already make us pay 21% VAT, which is our national tax, so no changes here.

Villodre

I think he was suggesting that the creators could absorb the tax, letting contributors receive their support less the tax. Patreon will need to find the right tax rate for each region anyway.

clickallnight

When I first started supporting people on Patreon - nearly six years ago now - I didn't pay VAT on the pledges, but I've been paying 20% for some time now.

Chris Crowther

Wait, there are places where you don't pay tax on patreon pledges? :| Been paying 21% ever since I joined... (yes, VAT is high here....*sigh* )

Buzzin

I don't think Patreon can really just 'absorb' it because different countries, different states and even different counties tax different things at different rates. I'm here for the long-haul though. I very much enjoy Technology Connections.

Don Eitner

I'm going to guess that with the world economy being in the toilet that most governments are beating the bushes for every penny right now

Yeah in Australia, we have the GST, and that is most likely what they are also referring to.

Paul Fisher

Since I'm in Sweden, I already pay VAT, so yea, no change for me I guess.

Patrik A

if you get something in return for your pledge, its taxed. If its just a flat donation, its not, tahts the explanation I heard.

BiggieJohn

BTW, Its illegal in some states to "absorb" sales tax. In these states, the sales tax is paid by the consumer, to the state. The business is just an agent that collects it, and is legally forbidden from "interfering" in that process.

Nicholas Festa

I mean, it's going to be a few cents a month on top for me, so I'm not that concerned, especially if it allows me to keep supporting creators on here.

Kevin Kostka

Thanks for letting me know. I for one enjoy the content you provide and because I enjoy it and I know it's hard work for you, I will continue to support you here on Patreon. If my pledge goes up a bit because of taxes, then it's the price I'll pay for the content I want.

Robert McCullough

Thanks for the info. This sucks, for instance, in my country (Chile) they started applying taxes on all online services (Dropbox, Netflix, Spotify, etc) so this makes sense with the info you have.

Diego Correa

25% VAT? I'll never complain about the 13% Ontario HST again.

Andi Kettu

Thanks for the heads up.

WildMartin

If he wanted to go to the trouble of setting of a non-profit, he could probably avoid some of the taxes. Not doing that, though, makes this a commercial enterprise. Patreon makes it "feel" like we're "donating" to him, but in reality we're electing to pay for creative content. Many creators with viewership over a certain level live entirely on monies they receive through their videos, whether via Patreon or YouTube ad revenue or direct sponsorships. I don't know (and don't need to know) his financial situation, but I would guess that he's achieved enough viewership to receive a useful amount of revenue from the videos he makes. It's only fair to all content creators that we who elect to purchase it should pay relevant sales taxes on it just like we would for content we buy in a store, and while I won't hold out judgement or ask what he does, it would only be fair for him to declare this income and pay relevant income taxes on it - just like anyone else who gets revenue for work they do, even if it's work they enjoy.

I don't know if it's relevant to your situation, but Ross Scott specifically went with PayPal for viewer donations because where he lives in Poland, Paypal subscriptions counts as gifts, but Patreon doesn't. https://www.youtube.com/watch?v=ohyB8V7Na_0

Might be a little jaded, but I doubt they'll let you absorb the taxes on the back end because that would mean a drop on revenue for them.

Generally the sales taxes are levied on the buyer, so neither of you should see any sales tax on your pledge. I, however, live in Illinois which has sales tax, but I guess the only real benefit in that is that since he and I are both residents we both (theoretically) benefit from whatever small different this sales tax makes ...

Or as I like to say "I only HAVE to do two things, die and pay taxes. But I don't HAVE to pay taxes."

Mr. Hunter Jones

You and I are both in the same state (Illinois), so at least we'll both get whatever benefit we get from whatever my sales tax turns out to be, lol ...

OH YEAH, I pay Swedish VAT at 25% on all my Patreon pledges

Staffan Ahlstrom

Examples of taxable items are in this help page: https://support.patreon.com/hc/en-us/articles/360043055071-New-Sales-Tax-Requirements-on-Patreon

Michael Dunn

God, I so despise the damn government. We are being GENEROUS by DONATING OUR HARD-EARNED MONEY to content providers we like, and now WE GET TAXED FOR IT?!!!! The American Revolution was fought for less than this!!!!

Laurence MacNeill

Oregon resident here - no sales tax for me. Would it be on your side as an Illinois sales tax?

For my hope this would be a good point to stop all this patreon-only-content. I stopped all my pledges for people who do this. For me patreon (and all the better(?) alternatives) is to give people for the work I consume which is free available and not for supporting "special" content (yeah, putting people names in the video is fine for me). Then there would be nothing to put tax on. But I just hope this new rules are fine for you.

dura

I think they're trying to avoid the same mass-exodus from the last time they tried dropping a "your pledges are changing" bombshell on the userbase, except they've focused on the wrong part of it. Someone probably thought, "Oh, the problem was that the messaging came from US and not from the creators," and not "oh, the problem was that it was poorly-considered and our messaging about it was vague and nonsensical"

fluffy

"in this world nothing can be said to be certain, except death and taxes." -Ben Franklin

George Davidson

These messages are so heckin' annoying. I used to be a Patreon Creator and even though I suspended my account I keep getting all of the creator messages every time I come to Patreon, and in addition to that I'm getting these "things might be changing! or they might not! nobody knows!" messages from all the creators I back. Wish there were a thing I could check to say "I GET IT ALREADY, jeeze"

fluffy

Tax attorney here - you don't want to know exactly what's happening because nobody knows exactly what's happening for everyone. It's a nightmare of fifty different US states and who knows how many countries having their own sales tax and VAT systems and all sorts of different categorizations and exemptions.

I'm aware, and I think this mostly applies to some US states, but I think there were some additional countries, too. Though I could be mistaken

Technology Connections

Patreon already collects sales tax (VAT) in the UK (and preseumably the EU) on top of pledges.

Martin Porcheron

Ahh, gotta love sweeping patreon changes eh? Hahaha

Dylan Packard

In Europe they just add tax on above our pledges - as far as I know neither you nor I have control over this.

Kirk Northrop