BorderX Lab Brings Aboard eTWP for Expansion of European Logistics

In 2021 Q4, BorderX Lab partnered with eTWP to coordinate EU VAT and streamline logistics from Europe to China.

Value Added Tax, or VAT, is a consumption tax that applies to all digital and physical goods or services sold in the EU. It is charged whenever value is added to the product throughout the supply chain, from production to the point of sale, adding up to 21% of the original price.

A 21% VAT can be a huge burden to our merchants. However, there are certain prerequisites that allow waiving this. Option one, merchants can issue invoices that show both seller and buyer’s VAT ID. Option two, merchants can present proof of export files that show that goods are out of the EU in a timely manner. Option two is something that BorderX Lab can always provide. However, many merchants do not have the ability to provide a viable invoice. This can be due to several reason, and including, but not limited, to lack of resources of the affiliated model. BorderX Lab’s BD team has been continuously building on it and working out the kinks, and has achieved some great progress.

Although a VAT ID is not difficult to apply for, there is a minimum guarantee required. Partnering with eTWP has granted BorderX Lab the advantage of starting at a lower guaranteed level, while the amount in our Belgium partner warehouses may be a bit higher. There can also be cases where merchants must pay the VAT upfront and then apply for refunds months later. eTWP will now be the front line and take care of the VAT and refund.

With BorderX Lab's VAT ID, we now offer 0% VAT sales with our merchant partners via the B2B model. Merchants provide BorderX Lab with invoice of goods sold and our VAT number, and then we coordinate with our partner to pay our portion owed (if any) to the government during that period. This is an expansion of our previous services, where we already supported certain merchants by providing export documents on a B2C model by coordinating international logistics.

The possibility to avoid a 21% VAT is a huge draw for any merchant looking to expand their EU to China business, and BorderX Lab is just getting started in their integration into the dynamic logistics industry.