Residents of Armenia, Norway and Switzerland are charged VAT by Amazon from the 1st of January 2020, reports Tamebay. This is due to regulation changes in these countries. When non-resident companies provide remote services, they now are required to begin to collect VAT on these services when they are provided to residents in these European countries or persons who are not registered for VAT.
These European countries class Amazon as a non-resident company and selling on Amazon is classified as a remote service. Hence, the requirement for Amazon to start to collect VAT. It is likely that this will happen in many more countries around the world. Especially since tax authorities increasingly focus on the digital world. Currently, VAT rates in the applicable countries are 20% (Armenia), 25% (Norway) and 7.7% (Switzerland).
Amazon collects VAT when residents incur selling on Amazon fees in these countries if they are not registered for VAT. New tax legislation requires Amazon to collect VAT at a standard rate on Selling on Amazon fees, paid by sellers unless a seller provides Amazon with their VAT number as evidence that they are VAT registered in an applicable country.
How to provide Amazon with your VAT ID:
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