Why do I have to pay import tax?

Question

I live in the UK, and I've found that many things are cheaper if bought from the US, even with the postage charge.

But, then I have to pay import tax.

Why does this tax exist, isn't it blocking free trade?

Answer 1

The short answer is yes it is blocking free trade.....however that blockade is an economical necessity.

It is true that certain, if not most, things can be bought cheaper outside of the UK, import taxes are put in place to diminish the perceived difference in benefit by way of financial saving. It is important for the government to keep a balance between money spent in the UK economy and money spent outside it.....import tax helps this balance.

GDP (Gross Domestic Product) does not take into account money spent outside the economy, money earnt in the UK and spent outside of the UK is called 'Leakage'....too much leakage and the economy slows leading to higher unemployment therefore higher taxes to pay for the increased unemployed.

Answer 2

ask your MP.

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The US does not have VAT and you do. Thus, all imports from the US are subject to VAT, plus whatever Customs duties may apply.