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The toxic side of free – how I lost the love for my side project (part 4)

remysharp.com

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Re: The toxic side of free – how I lost the love for my side project (part 4)

#51

Post by [deleted] »

JoshTriplett wrote: post #49
aianus wrote: post #46

How would the EU enforce VAT requirements on an online business based in the U.S.? If I have an online business in the US and no presence in the EU and no intention to ever go to the EU, I don't have to charge VAT, right?

Correct. In theory if the project grew large enough (as in "billion-dollar industry"), the EU might start attempting to control it or block it, or attempt to regulate transactions involving it under the auspices of import/export/tariffs, but in general the EU (or any non-US company) has no jurisdiction to impose taxes on a US company. (Nor does the US have jurisdiction to impose taxes or regulations on an EU company,…

[deleted]

Re: The toxic side of free – how I lost the love for my side project (part 4)

#52

Post by JoshTriplett »

masklinn wrote: post #27
nkozyra wrote: post #20

Earlier quoted context omitted.

I think the obligation to pay customers' VAT goes back way before VATMOSS. That said, I think you've answered your own question. Unless you're at a size that would be drawing attention, it would be logical to ignore this if you're not in the EU.

> I think the obligation to pay customers' VAT goes back way before VATMOSS. Yep, VOES was put in place in 2003 and that was a simplification, before that businesses were supposed to register themselves with each country's tax office and fill VAT everywhere. For non-EU businesses VATMOSS mostly updates the scheme: register yourself in any member state and use their MOSS portal as a non-EU business, the tax office is…

A business outside the EU has no obligation to do anything, unless it makes itself subject to EU jurisdiction. Just as you don't have to collect US state sales taxes for any US state unless your company has a legal presence in that state.

That doesn't help you if you're in an EU country, of course.

Re: The toxic side of free – how I lost the love for my side project (part 4)

#53

Post by finnn »

thesis wrote: post #10
Osiris wrote: post #4

Regarding his fraud issue, I found that my website was being used in the same way when I added a credit card payment form. I implemented a system that first does an "Auth". If that passes, then I pass details to MaxMind and get back a response with a "riskScore". If the score is too high, I void the auth and decline the transaction. This has saved me a lot of chargeback fees, though it's still not perfect. I prefer P…

Definitely definitely definitely use something like Minfraud from Maxmind. The cost is negligible. We set the score we block transactions at rather low, and manually approve anything over that. It's super cheap and has saved us tons of money and headaches!

Seems like this should be on the credit card processor to deal with?

Re: The toxic side of free – how I lost the love for my side project (part 4)

#54

Post by Namrog84 »

munificent wrote: post #21
degenerate wrote: post #14

Earlier quoted context omitted.

But then you'll have people creating new accounts every time the trial ends, instead of paying! The sweet spot is probably 24 hours. Too long for a fraudster to wait around, and too short for people to bother making an account every day for pro fuctionality.

> But then you'll have people creating new accounts every time the trial ends, instead of paying! These would be malicious users . Both words are significant here. People using the service just to check credit cards are malicious, but not users. Free users are users but not malicious. I think for most services, the set of actual malicious users—people who do want to use the service for its intended purpose, but don't…

Yeah and if heavy users want to constantly deal with changing email addresses and moving accounts just to get out of it. Like you said is few. Let them be? It's likely they generate word of mouth and other value being invested enough to go thru the hassle.

Re: The toxic side of free – how I lost the love for my side project (part 4)

#55

Post by PythonicAlpha »

bluecalm wrote: post #34
ffn wrote: post #11

Okay, say you're a US citizen building some digi service like JS Bin, and VATMOSS starts fling threats at you, for how long can you go about ignoring them? I mean 3.5k GBP and however many weekdays it took isn't exactly affordable for every small business, and if you don't even have many Euro pro-users, I don't see the cost-benefit justification of giving VATMOSS priority unless they can reach across the Atlantic.

VATMOSS is a nightmare for small businesses. I am lucky that authorities in my country decide that I can avoid it with my project (because it doesn't fit exact definition of electronic service so I can pay VAT in my country as it's a place the service is provided in according one interpretation of the new law) but they have plans to extend it and I may be forced to go through accounting hell to comply with this regul…

Thank you for sharing!

>I guess they think typical business is like Google or Amazon or something.

I guess, that is all they want -- and it very likely could be, that this is all they will get, when they are not stopping this. The EU is about to kill inventions in the online business. With this kind of regulations, the EU will become a dessert with the Amazon's and Googles ruling over it.

But I think, many big systems tend to go in this direction: The dinosaur corporations are going to win, because after the day, they can change the rules to their favor and the small businesses are going downhill, because they are to small to be recognized -- but those are those that innovate. And remember: Google and Amazon once also started small, but those where the days, where the focus of the big players where mostly elsewhere.

Re: The toxic side of free – how I lost the love for my side project (part 4)

#56

Post by teddyh »

ChuckMcM wrote: post #6

I discovered a similar problem with writing, which is that writing an email or a comment takes no time at all, but when someone is paying for what I write it takes a lot more effort . I wrote a column for a couple of years and it wasn't until the second year that I actually took my editors advice to just send her the first version and work on it collaboratively rather than try to get it perfect. I see side projects a…

Studies Find Reward Often No Motivator

http://www.gnu.org/philosophy/motivation.html

Re: The toxic side of free – how I lost the love for my side project (part 4)

#57

Post by PhantomGremlin »

TheSmoke wrote: post #33
Osiris wrote: post #4

Regarding his fraud issue, I found that my website was being used in the same way when I added a credit card payment form. I implemented a system that first does an "Auth". If that passes, then I pass details to MaxMind and get back a response with a "riskScore". If the score is too high, I void the auth and decline the transaction. This has saved me a lot of chargeback fees, though it's still not perfect. I prefer P…

risk score means the possibility of a transaction being fraudulent. here's another way you can do this for cards issued in Europe: if the risk score is too high start a 3D secure transaction. if the risk score is acceptable then start a normal transaction. a full 3D transaction will never mean it is not fraud however you will have no liabilities when a chargeback is issued by the card holder. many of your US customer…

many of your US customers, if not all, will fail to pay via 3D-secure because god knows why

As I mentioned in another reply, "Verified by Visa" is a stupid joke. Which, fortunately, I don't think I've seen anymore in at least 10 years. The paper linked in the other reply to you provides more details of how stupid this thing is.

IIRC basically the first time you encounter it you get a popup asking you to create an account. Yeah, right, I'm on some random website and I'll just start entering all sorts of security information into a popup. NOT! I did some checking when I first encountered it, and decided it was legit. But 99% of people won't. They'll just say "fuck this, I don't need this shit". They will then go elsewhere.

I encountered it a few more times after I first signed up. And it would have maybe a 50% success rate of actually "verifying" my transaction. I'd enter the information and nothing would happen.

It's the antithesis of the friction-free way that Amazon does business. I probably use Amazon once every few years but they still have all my info saved. I don't have to enter an address, I don't have to enter a CCV, I don't have to enter a credit card number. It only takes a few mouse clicks to complete an order on Amazon.

So, which payment method would the average person prefer?

Edit: look at what Wikipedia has to say, it generally makes the same points as the paper. Why would anyone voluntarily want to use this? https://en.wikipedia.org/wiki/3-D_Secure#General_3-D_Secure_...

Re: The toxic side of free – how I lost the love for my side project (part 4)

#58

Post by Vexs »

daxelrod wrote: post #37
TheSmoke wrote: post #33

Earlier quoted context omitted.

risk score means the possibility of a transaction being fraudulent. here's another way you can do this for cards issued in Europe: if the risk score is too high start a 3D secure transaction. if the risk score is acceptable then start a normal transaction. a full 3D transaction will never mean it is not fraud however you will have no liabilities when a chargeback is issued by the card holder. many of your US customer…

As a US customer, I'm hesitant to use 3D Secure because: 1) The implementations by Visa and MasterCard have security weaknesses, terrible usability and look like phishing: http://www.cl.cam.ac.uk/~rja14/Papers/fc10vbvsecurecode.pdf 2) My understanding is that my bank shifts liability to me for 3D Secure transactions. Why would I want extra liability?

"with one (UK-government-owned) bank, two wrong password attempts simply lead to an invitation to set a new password."

Good lord! Reading through this document is like reading a primer in how not to make a secure form.

Re: The toxic side of free – how I lost the love for my side project (part 4)

#59

Post by Symbiote »

PhantomGremlin wrote: post #48
daxelrod wrote: post #37

Earlier quoted context omitted.

As a US customer, I'm hesitant to use 3D Secure because: 1) The implementations by Visa and MasterCard have security weaknesses, terrible usability and look like phishing: http://www.cl.cam.ac.uk/~rja14/Papers/fc10vbvsecurecode.pdf 2) My understanding is that my bank shifts liability to me for 3D Secure transactions. Why would I want extra liability?

Yeah, "Verified by Visa" is exactly like phishing. Good paper. Fortunately here in the USA I haven't been asked for my credentials in at least 10 years. So it seems to have died the death it so richly deserved. Do people encounter this on a daily basis?

It's ages since I've seen it used in the UK, although not 10 years. More like three or four.

(The redirect sometimes happens, but it's automatically approved.)

Re: The toxic side of free – how I lost the love for my side project (part 4)

#60

Post by tzs »

TheOtherHobbes wrote: post #18
pnathan wrote: post #12

Earlier quoted context omitted.

Stupid question: is there a service which you can hand off the evidence-gathering to? Seems like a very good opportunity.

There are various attempts, but currently no one - especially not HMRC - has any idea how to handle VATMOSS correctly. I've heard a few stories about small businesses suddenly getting demands for thousands of pounds (etc) after only a handful of transactions. But what I suspect will happen is that HMRC will realise that chasing and fining microbusinesses for non-compliance is a complete waste of everyone's time. They…

The stories you heard may have been due to the Irish fuck up a month ago. The Irish tax authorities mistakenly sent out a couple thousand notices claiming completely bogus deficiencies. More info here: https://news.ycombinator.com/item?id=10083238

Germany and one or two others have also sent deficiency notices to UK sellers. The UK tax authorities have complained about that, saying one of the main points of the VATMOSS system was that sellers would only have to deal directly with the tax authorities in their country. If Germany, for example, thinks a UK seller underpaid for VAT on German customers, the UK's understanding was that Germany was supposed to bring that up with the UK tax authorities, and they would be the ones to get it straightened out.

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