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Patreon Announcement & New Minigame Sneak Peek (Patreon)

Published:
2020-05-08 05:04:06
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Hi guys!

I have a Patreon-related announcement for you all today: Starting July 1st, some patrons may start to be charged sales tax on their pledges on Patreon.

Patreon will make the general announcement early next month, but they graciously gave us creators a few weeks in advance to let our patrons know directly. Here is what I took away from their presentation on the subject:

  • Patreon has already been collecting VAT from EU patrons for years. This extension to customers in the United States (and a few more countries) is a result of enforcement of a new law requiring digital storefronts (like Amazon and eBay) to pay sales tax.
  • Patreon estimates 30% of patrons will be affected, and that tax rates for residents of applicable states will be between 4-11%. You can check this list to see if you will be affected.
  • The tax will be charged to the patrons, not the creators, because in the United States it is generally not allowed to include tax in the ticket price. How much patrons will be taxed will vary by where you live and by the type of rewards you receive.
  • Creators will have some control over what patrons will pay. Patreon will be giving us tools that will allow us to declare our tiers as either containing physical rewards, digital rewards, or no rewards (tip only). Some categories may be taxed less or not at all, depending on where you live. We will also be able to assign weighting to our tiers, so that you need not necessarily be taxed on the full pledge if the taxable reward is only a fraction of it.
  • Again, this will all go into effect on July 1st. Patreon will make its general announcement on June 1st, but if you want to learn more now, you can review their FAQ on the subject. 

That was a lot to digest! In short, it sucks, but not everyone will be impacted, and us creators will make sure those who are will pay as little as they have to. I'm still wrapping my head around this development too, but feel free to ask if you have any questions, and I'll do my best to answer!

I'd intended to post about Baird's this week, but figured this announcement took precedent. Baird's will be next! In the meantime, for all of you who made it to the end, here is a sneak peek at the new third minigame in Changeling Tale...

(spoilers below!) 







Comments

OmniOtter

I already looked at the affected states, and Ohio is one of them. I remember when Spotify started collecting sales tax in my state, so taxing digital goods on Patreon is no surprise.

OPjack

Cuddle-Simulator nice😁 I'am from Germany so I will be Not taxed again, correct? Even when I will support this project further, come whatever may.

Scott Wulf

Glad to see I am not the only one from Ohio...and now I don't have to wonder if I will be, but I amnot gonna worry either, because I will continue to support the games I love!

Lunatico Ursus

Here in México just aply a new law about VAT to all online services: Netflix, Spotify, etc. Patreon included. But is not clear if going to affect creators or patreoner When I see this post I think Mexico will be on that list, but no...hmmm

Nocturn3

Bad news; taxes Good news; SCRATCHES!

Luxuria Unus

Surprisingly, my state is not on the list, guess some good had to come out of this sweltering state, aye? Regardless, unfortunate to those that are affected, glad Patreon is giving creators some control over it though, would hate for sales tax to not only affect people who are already tight on budget, but also, in turn, affect the funding of projects like this one, and the many others that look to Patreon as a leg up. But some absolutely great news out of all of this, scratchies! Who's a good Jessie, you are!

FEYADA

As I understand it, the Patreon team doesn't want to pay taxes. So they do everything to make someone pay, but not them. In 2018 (if I am not mistaken), they tried to do the same. CREATORS vs PATREON. It was a glorious battle where the creators won. Patreon understand that patrons and creators feed them. But they also want to shove taxes on someone. The main question is: Will riot happen again? Upd: Then they wanted to shift the tax to the creators, now they want to shift the tax to the patrons. I wonder if the petition will help?

LittleNapoleon
>>36547652

If the law is new, Patreon will probably update its list accordingly when the law goes into effect, to keep current with regulations ^^

LittleNapoleon
>>36560538

Yeah, the timing on this is less than ideal for sure. If people need to cut back on their pledges, I totally understand! We may have reached the pinnacle of gaming with werewolf bellyscratches : )

Giza White Mage
>>36565049

I know in my state (PA), sales tax applied to a great many things, and it's always paid by the end consumer. I pay sales tax on Amazon purchases, and I expect things will be no different here on Patreon. Depending on your state or country, your mileage may vary.

Rey Fox

Will this be dropped into Chapter 3?

Wat
>>36565049

So, it's not nearly that malicious, in 2018 the issue was different. In 2018 they were looking to shift money to creators from patrons, this wasn't tax related but payment processor fee related. They were going to apply a 5-10% fee on top of all charged to cover payment processing fees. Patreon looked at creator backlash (we didn't want to charge our patrons more) and reconsidered the proposition, instead keeping the old system where creators ate the payment processor fee. This new system is entirely because new laws go into effect in July that force all web services to charge web service and sales tax based on the state of the purchaser. This is not Patreon looking to shift fees, they legally cannot pay these taxes for you (it's not even legal for them to show the final taxed amount before payment is being made, sales tax cannot be factored into the original price legally, the government mandates that). This is just Patreon complying with new laws and regulations that force sales tax to be included on web services and products.

Wat
>>36652771

It will be, once the Grace 3 chapter update is finalized this should be in as well :B