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US retailer charged tax but I was charged taxes at border also

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  • Aug 2nd, 2021 7:24 pm
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Jul 31st, 2021 11:07 am
sharpshooter88 [OP]
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Jul 31st, 2021 11:07 am

US retailer charged tax but I was charged taxes at border also

Wondering if anyone had this problem, this is a first for me and I've bought alot from North American retailers.

I purchased something online that was shipped from US retailer. At checkout I was charged taxes, invoice clearly shows it was for Canadian taxes. Seeing this, my expectation was that I will not have to pay any custom charges and fees at the border.

However when the package was delivered by FedEx, they also gave me a bill for $20 in taxes (similar to what retailer charged) and Fedex's crazy fees of $40. It seems the retailer never declared that the taxes were already collected, and they are possibly keeping the taxes they charged me for themselves?

Anyways, I called FedEx but I didn't really expect anything from them. They told me I had to talk to the retailer which I expected. But the retailer is saying they are not responsible for duties, but upon reading their FAQ they clearly state they do not collect any taxes for international orders so I'm puzzled as to why they charged me upon checkout if that was the case.

Just wondering I'm reading the situation right and that it's the retailer that's completely at fault.
Last edited by sharpshooter88 on Jul 31st, 2021 11:44 am, edited 1 time in total.
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26 replies
Jul 31st, 2021 11:13 am
PointsHubby
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Jul 31st, 2021 11:13 am

Which Retailer ?
And need more details on the invoice
What you bought, how much, and all the line entries & amounts
(Duty is charged or not dependent on the item, and where made etc )

Better yet, post a pic copy of your receipt
+3
Jul 31st, 2021 11:23 am
sharpshooter88 [OP]
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Jul 31st, 2021 11:23 am

I'll have to get the info from the wife, it's in her emails. It was for some baby clothes totally about $100 or so. If it helps, the invoice specially lists the taxes as GST and HST.

I just didn't expect to pay taxes twice. I bought something recently from another US retailer, they charged taxes so that I didn't have to pay anything extra at the border.
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Jul 31st, 2021 11:32 am
Holystone
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Jul 31st, 2021 11:32 am

Taxes and duties are two separate things.

I checked on the CBSA site and for clothes not made in US or Mexico, the duty is 18% and tax is 13% (ON). I believe goods under $20 are exempt.
”If you buy things you don’t need, soon you will have to sell things you need.”
Jul 31st, 2021 11:39 am
sharpshooter88 [OP]
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Jul 31st, 2021 11:39 am

Holystone wrote: ↑ Taxes and duties are two separate things.

I checked on the CBSA site and for clothes not made in US or Mexico, the duty is 18% and tax is 13% (ON). I believe goods under $20 are exempt.
Thanks, but I thought baby clothes were exempt from duties (from what I've read). From the FedEx invoice it was HST that was being charged.
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Jul 31st, 2021 11:46 am
Holystone
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Jul 31st, 2021 11:46 am

sharpshooter88 wrote: ↑ Thanks, but I thought baby clothes were exempt from duties (from what I've read). From the FedEx invoice it was HST that was being charged.
I selected boys clothing since I didn’t find baby clothing as a selection and that may very well be because they are exempted as you say.
”If you buy things you don’t need, soon you will have to sell things you need.”
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Jul 31st, 2021 11:50 am
sharpshooter88 [OP]
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Jul 31st, 2021 11:50 am

Holystone wrote: ↑ I selected boys clothing since I didn’t find baby clothing as a selection and that may very well be because they are exempted as you say.
I appreciate the help. I just want to make sure I'm right before I go scorched earth with this retailer, haha.
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Jul 31st, 2021 12:37 pm
mrweather
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Jul 31st, 2021 12:37 pm

I didn’t think there was retail sales tax on baby clothing?

Duties are something separate.
Jul 31st, 2021 12:45 pm
macnut
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Jul 31st, 2021 12:45 pm

You correctly changed the subject line, OP. You were charged tax and of course brokerage at the border by Fedex.

Doesn't make sense that retailer listed GST and HST. If anything, should have been HST only, or GST + PST. Plus a small amount for clearance fees.
And if they are not going to communicate to Fedex they have done that, it all becomes screwed up.
So retailer needs to smarten up.
What does their shipping policy say for international purchases?
Jul 31st, 2021 1:23 pm
sharpshooter88 [OP]
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Jul 31st, 2021 1:23 pm

macnut wrote: ↑ You correctly changed the subject line, OP. You were charged tax and of course brokerage at the border by Fedex.

Doesn't make sense that retailer listed GST and HST. If anything, should have been HST only, or GST + PST. Plus a small amount for clearance fees.
And if they are not going to communicate to Fedex they have done that, it all becomes screwed up.
So retailer needs to smarten up.
What does their shipping policy say for international purchases?
Thanks, yes I made a mistake in the title, I was charged taxes and not duties at customs.

For their shipping policy, they say they do not collect any taxes and that any custom fees incurred are the responsibility of the buyer. We did not see this until recently or else we would have questioned why taxes were being charged at checkout from the beginning.

In my opinion it seems like their checkout process is not in line with their shipping policies and incorrectly excluded the taxes in the Customs declaration.
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Jul 31st, 2021 1:24 pm
redflagdealsguy
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Jul 31st, 2021 1:24 pm

There is a double-tax incidence, but it's the normal cross-jurisdiction taxation situation.

Purchase = Price + State Tax (if applicable) + Duties (HST equivalent) + Additional Tariffs Where Applicable (select industries) + Brokerage Fees

The above is approximately correct.
.
Jul 31st, 2021 1:44 pm
jjesskaka
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Jul 31st, 2021 1:44 pm

It sounds like it is retailer's fault for collecting taxes on international order when they didn't declare and pay taxes on your behalf. You should at least get the taxes you paid to the retailer back. And I thought there is no HST on kid's clothes, so the retailer wasn't even charging the right amount.

I have never had any incident where I paid for "taxes" at checkout but still got charged for " duties" when parcel arrives. Usually when a merchant charges taxes at checkout, they also take care of import duties so there is no extra fees when parcel arrives.
+2
Jul 31st, 2021 1:45 pm
Jon Lai
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Jul 31st, 2021 1:45 pm

Are you sure the retailer charged you Canadian taxes and not US taxes? While not impossible, it is rare for US retailers to charge Canadian tax. Those that do so, do it because they participate in a program that will do the customs paperwork for you at the border.
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Jul 31st, 2021 1:51 pm
sharpshooter88 [OP]
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Jul 31st, 2021 1:51 pm

Jon Lai wrote: ↑ Are you sure the retailer charged you Canadian taxes and not US taxes? While not impossible, it is rare for US retailers to charge Canadian tax. Those that do so, do it because they participate in a program that will do the customs paperwork for you at the border.
That's what I thought at first too, but the invoice clearly marks it as "Canada GST/TPS" at 5.75% and "Ontario HST" at 15%. Seems like baby clothes should be exempt from the 8% taxes.

Anyways, it really seems like they are in the wrong. I appreciate all the replies.
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Jul 31st, 2021 1:53 pm
sharpshooter88 [OP]
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Jul 31st, 2021 1:53 pm

jjesskaka wrote: ↑ It sounds like it is retailer's fault for collecting taxes on international order when they didn't declare and pay taxes on your behalf. You should at least get the taxes you paid to the retailer back. And I thought there is no HST on kid's clothes, so the retailer wasn't even charging the right amount.

I have never had any incident where I paid for "taxes" at checkout but still got charged for " duties" when parcel arrives. Usually when a merchant charges taxes at checkout, they also take care of import duties so there is no extra fees when parcel arrives.
I'm aiming for the full bill from FedEx to be covered. IMO this customs charge only happened because of the retailer's mistake, so I shouldn't have to pay any part of it.
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Jul 31st, 2021 1:55 pm
Jon Lai
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Jul 31st, 2021 1:55 pm

sharpshooter88 wrote: ↑ That's what I thought at first too, but the invoice clearly marks it as "Canada GST/TPS" at 5.75% and "Ontario HST" at 15%. Seems like baby clothes should be exempt from the 8% taxes.

Anyways, it really seems like they are in the wrong. I appreciate all the replies.
5.75% doesn't sound like GST, which is 5% across the nation. That sounds like state tax, which varies but is often fractions of a % like that.

Ontario HST is also not 15%. Sounds like the labels are wrong. Which state is this retailer based out of?
Jul 31st, 2021 2:02 pm
sharpshooter88 [OP]
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Jul 31st, 2021 2:02 pm

Jon Lai wrote: ↑ 5.75% doesn't sound like GST, which is 5% across the nation. That sounds like state tax, which varies but is often fractions of a % like that.

Ontario HST is also not 15%. Sounds like the labels are wrong. Which state is this retailer based out of?
Those numbers I worked out on my own, but the labels are what were on my invoice. I understand that HST is 13% in Ontario but it seems like a very trivial thing to have correct labeling so I'm shocked if it's simply a mix up of not putting the State name into it.
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Jul 31st, 2021 2:54 pm
Kiraly
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Jul 31st, 2021 2:54 pm

sharpshooter88 wrote: ↑ That's what I thought at first too, but the invoice clearly marks it as "Canada GST/TPS" at 5.75% and "Ontario HST" at 15%. Seems like baby clothes should be exempt from the 8% taxes.

Anyways, it really seems like they are in the wrong. I appreciate all the replies.
Was this retailer in Ohio? 5.75% is the rate of state sales tax there. I'm guessing that's what you were charged.
Ask the retailer for their GST number. If they don't have or can't produce it, then they didn't collect any GST/HST. They collected something else and labelled it incorrectly.
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Jul 31st, 2021 2:58 pm
sharpshooter88 [OP]
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Jul 31st, 2021 2:58 pm

Kiraly wrote: ↑ Was this retailer in Ohio? 5.75% is the rate of state sales tax there. I'm guessing that's what you were charged.
Ask the retailer for their GST number. If they don't have or can't produce it, then they didn't collect any GST/HST. They collected something else and labelled it incorrectly.
No, they are in Utah.
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Jul 31st, 2021 4:32 pm
macnut
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Jul 31st, 2021 4:32 pm

Still, could be they charged Utah State tax of 4.85% + county and/or city tax bringing it up to 5.75%.

A lot of smaller U.S. businesses don't follow (somewhat complex) prescribed rules on when and when not to apply their local tax, whether for in-store or online customers.

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