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Is VAT charged inclusive of the asked price when using payments collected by itch?

A topic by RAJACORP created Nov 08, 2023 Views: 868 Replies: 4

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Hi,

Up until recently I have been using the direct-to-you payment mode. In this mode, EU residents pay my asked for price (1.99) and then on top of that pay VAT.

Does this work the same way for collected-by-itch? Or does the 1.99 price include the VAT?

I ask because I am soon to be releasing my game on Steam early access and as part of their terms you may not sell your game for a lower price anywhere else. This leaves me in a bit of a problematic situation if VAT isn't inclusive as I will either have to stop selling on itch or raise the price to be higher than that of Steam.

I'd appreciate any clarification. Thanks.

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hechelion1 year ago (1 edit)

From what I remember, Steam's policy is that you do not sell copies of their keys at a lower price (in general), unless it is a limited time offer or an event.

In any case, this is for the base price, not the value of a particular area, that is, if your base price in Steam is 1.99 and in Itch it is also 1.99, you already comply with Steam's policy.

Regarding your question, as far as I remember, Itch always adds the VAT to the price to pay and does not have reduced prices for different countries. So the price to pay on itch is equal to or greater than the value that a customer will pay on Steam. You shouldn't have any problems.

I have a pay game here and in steam, the same base price in both stores and never has a problem.

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RAJACORP1 year ago

That would make itch more expensive for EU buyers though. On steam (at least in the UK) the price you see already included the VAT. So I see a game listed for £5 and then I pay £5 and checkout and the VAT is already included in the price. If I put the price as £5 on itch then people in the eu would have to pay tax on top of that price. Unless I'm missing something obvious.

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hechelion1 year ago

That's correct and there was a thread from a person complaining about precisely that.

The problem is that in the USA it is normal for them to show you the value without tax and then charge you additional tax at the time of paying (even in physical stores).

In many other countries, it is the opposite, the price they inform you is the final value to be paid by the user and a tax is deducted from that value.

Itch only has prices for the USA and uses the first system.

Steam locates prices by country and/or area. What you can do is manually configure the price for each country or area to reflect the VAT, but that is something you as a developer must do in the steam menu.

The most common thing is to leave that on automatic and have Steam set different prices according to its algorithm, that is the real reason why a game bought in the UK on Steam will be cheaper than buying it on Itch.

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redonihunter1 year ago

as part of their terms you may not sell your game for a lower price anywhere else

Read the terms carefully. Are they talking about you selling steam keys somewhere else? Or are they talking about the game as such?

It could be argued, that the game on itch is not the same game as on steam, despite having mostly the same content. For instance, you cannot have steam achievements with a version sold on itch.

Of course, if you give away a free steam key on itch with a purchase, those terms will apply to you. But yeah, pricing and taxes and even currency is an interesting questions. What if you sell it on itch in $ and on steam in £. Currencies change in value...

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