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Identical tax rules apply for social media sales, says gov



People selling goods via social networks are subject to the same tax and business registration requirements as offline sellers, Luxembourg’s finance minister has said.  Library picture: Dole777/Unsplash

People selling goods via social networks are subject to the same tax and business registration requirements as offline sellers, Luxembourg’s finance minister has said.  Library picture: Dole777/Unsplash

Selling goods via social media is not a grey area for Luxembourg’s tax authorities, the government has told parliament.

Income from selling goods on social media sites should be declared to Luxembourg’s tax office, and tax may be due if the revenue surpasses an exemption threshold, the government has said. And anyone who sells on a regular basis must apply for a business license.

The information was provided by Pierre GramegnaPierre Gramegna, the finance minister (DP) in response to a parliamentary question from the MP Sven ClementSven Clement (Pirate party).

“The sale of goods on social media must be declared to the tax authorities,” Gramegna said on 13 August. “For the sale of goods via social networks, in terms of direct taxation, the same tax rules apply as for other private sales that do not take place on social networks.”

The sale of secondhand items usually garners a lower sum than the original purchase price. However, any such loss cannot be used to offset other taxable income, Gramegna stated. Income from the sale of goods purchased during the past six months is taxable. But revenue under €500 is tax-free, the finance minister explained.

In addition, anyone who makes sales on a repeated basis is required to obtain a business permit. “A private individual, who regularly sells goods on social media, therefore needs a business authorisation, regardless of the size of their income generated.”