TAX POLICY (VAT & GST)

Last Updated: 09-June-2026

2.1 OVERVIEW

This Tax Policy explains how VAT, GST, and other applicable taxes are handled across the Platform’s three service models:

  • Dropshipping Marketplace
  • Ecommerce Marketplace
  • Classified Ads Marketplace

Tax responsibilities vary depending on the transaction model.

2.2 DROPSHIPPING MARKETPLACE (PLATFORM MANAGED)

2.2.1 Tax Responsibility

In the Dropshipping model, the Platform is responsible for:

  • Calculating applicable VAT/GST at checkout
  • Displaying tax-inclusive pricing to buyers
  • Collecting taxes from customers where legally required
  • Remitting taxes to relevant authorities where applicable

2.2.2 Buyer Transparency

  • All taxes are clearly displayed before payment confirmation
  • No hidden fees or undisclosed charges are applied

2.2.3 Dropshipper Liability

Dropshippers have no responsibility for:

  • Tax registration
  • Tax filing
  • Tax remittance

2.2.4 Merchant of Record (MoR)

The Platform may act as Merchant of Record in selected jurisdictions where legally required.

In such cases, the Platform assumes tax collection and remittance obligations only for those specific transactions.

2.3 ECOMMERCE MARKETPLACE (BUSINESS SELLERS)

2.3.1 Seller Tax Responsibility (FULL LIABILITY)

Business sellers are solely responsible for:

  • VAT/GST registration
  • Tax filing and reporting
  • Corporate and income taxes
  • Compliance with all local tax laws

The Platform does not act as tax remitter for ecommerce sellers.

2.3.2 VAT Verification System

The Platform may use VAT validation tools to:

  • Verify VAT registration numbers
  • Confirm business legitimacy
  • Support seller onboarding compliance

2.3.3 Tax Calculation & Display

The Platform may:

  • Calculate VAT/GST based on buyer location
  • Display tax at checkout
  • Show final total price before payment

This is for transparency only and does not transfer tax liability to the Platform.

2.3.4 Platform Role

The Platform:

  • Provides tax calculation and display tools
  • Supports compliance verification
  • Does not assume tax filing responsibility for sellers

2.4 CLASSIFIED ADS MARKETPLACE

2.4.1 Tax Responsibility

The Platform does not:

  • Collect taxes
  • Calculate taxes
  • Remit taxes

Buyers and sellers are fully responsible for any applicable tax obligations.

2.4.2 Platform Role

The Platform only provides:

  • Listing services
  • Optional advertising features (boosted listings, featured ads)

All classified transactions occur outside the Platform.

2.5 CROSS-BORDER TAX RULES

  • Tax treatment may vary based on buyer and seller jurisdiction
  • International transactions may include VAT, GST, customs duties, or import charges
  • Local laws of the destination country may apply

2.6 TAX TRANSPARENCY PRINCIPLE

The Platform ensures:

  • Full tax breakdown is shown before checkout
  • Clear separation between product price and tax
  • No hidden charges

2.7 CUSTOMS & IMPORT DISCLAIMER

  • Customs classification (HS codes) may be automated or supplier-provided
  • The Platform does not guarantee customs accuracy in all jurisdictions
  • Customs delays, inspections, or charges are the buyer’s responsibility

2.8 TAX CALCULATION LIMITATIONS

  • Tax rates may be estimated based on available jurisdiction data
  • Final tax amounts may vary due to government changes or rounding rules
  • The Platform is not responsible for external tax authority adjustments

2.9 TAX CHANGE NOTICE

The Platform reserves the right to:

  • Update tax rates without prior notice due to legal or regulatory changes
  • Modify tax systems to maintain compliance
  • Apply changes immediately where required by law

2.10 FRAUD & TAX EVASION POLICY

Strictly prohibited:

  • Misuse of VAT/GST numbers
  • False declarations to avoid tax
  • Any attempt to bypass tax obligations

Violations may result in:

  • Account suspension
  • Order cancellation
  • Legal reporting where required

2.11 COMPLIANCE STANDARDS

The Platform complies with applicable tax regulations including:

  • EU VAT Directives (LilBay)
  • Swedish tax regulations (LilBay entity)
  • UAE Federal Tax Authority requirements (SalaamGCC entity)
  • Other applicable international tax laws

2.12 LIMITATION OF LIABILITY

The Platform is not responsible for:

  • Incorrect tax filings by business sellers
  • Changes in tax laws affecting users
  • Tax obligations in Classified Ads transactions
  • External compliance requirements beyond Platform control

2.13 MODEL SUMMARY (FOR CLARITY)

  • Dropshipping → Platform handles tax collection & remittance (where applicable)
  • Ecommerce → Sellers handle tax, Platform only calculates & displays
  • Classified Ads → No tax handling by Platform

2.14 IMPORTANT NOTICE

Tax regulations vary by jurisdiction and may change over time. The Platform continuously updates its tax systems to remain compliant. Users remain responsible for compliance with their local laws where applicable.