StockX Luxury Import Tax of 15% for Non-US Sellers
So StockX have been in the news again. The dust has barely settled on the hacking incident and they are making headlines again. This time for an introduced StockX luxury import tax which looks set to shake up a lot of things in the market for all the wrong reasons. This new duties fee of 15% will be applied to all non-US sellers. As the news broke all international accounts had already been alerted of this policy change via email which outlined the following specifics:
Items valued at $800 USD and over that are shipped from outside of the US are subject to import taxes. This charge was not included previously in the transaction price. StockX now, however, insists that a pricing model that is inclusive of all regulatory costs is necessary in order to facilitate a truly global marketplace. Meaning that the StockX Luxury Import Tax must now be applied, and as each country has its own VAT rate (usually ranging from 10-20%) as well as import duties. StockX’s analysis of all costs incurred in the past showed that 15 percent is the average.
What is the issue with the new policy?
This issue with this new policy is that international (non-US) sellers are now charged this fee regardless of the destination of their product. What this means is because StockX’s system is currently unable to identify the location of buyers and sellers as results of their algorithm currently work based on the bid-and-ask system which does not automatically distinguish buyer, seller location. That means international sellers will still have to pay the 15% fee even if they are going to another international location. Yet with the EU’s single market and customs union in place, they shouldn’t have to. As there are no tariffs on goods moved from one member state to another. For example a trainer shipped from France to Portugal would incur no import tax.
How this will affect a sale of a product on StockX?
As an example of how these numbers translate to a sale. If you were to sell the Air Jordan 1 “Satin Black Toe” for $799, that would earn you $691.62 after the 9% transaction fee, 3% payment processing fee, and shipping costs which has always been in place. Yet if you sold the exact same pair for one dollar more at $800. The seller would be subject to a further $120 worth of StockX Luxury Import tax. Making the final payout $572.50.
What this could mean for the Stockx Market?
Obviously at this stage it is still unclear what this could all mean for StockX but we can definitely make some educated guesses. Either sellers will look to offset their losses by raising their listing prices. Or we will see a whole bracket of $799 listed products to avoid the taxes all together. Or perhaps even more worryingly for StockX, we could see sellers take their products elsewhere to rival online trainers platforms who do not apply the same harsh fees.