This is an important announcement to let you know about an error in the calculation of US royalty withholding tax for Vietnamese authors.
As you’ll likely be aware, Envato applies a 10% royalty withholding tax on sales from Vietnam-based authors to US customers.
The rate that we apply was taken from a recent agreement between the US and Vietnamese governments which provides for a reduced rate of 10% withholding tax on royalties. Upon learning of this treaty, Envato took the adjusted tax rates to be in full effect.
Unfortunately, we’ve recently learned that this isn’t the case.
Despite the existence of the agreement, it has not yet been ratified by the United States. The result of this is that Envato has been under-charging US royalty withholding tax to Vietnamese authors at a rate of 10% instead of 30%.
We will not attempt to recoup the cost from authors.However, we do need to ensure that the situation is rectified moving forward. As a result, we need to inform you that as of 8/9/2016 the royalty withholding tax for Vietnamese authors selling to US customers will increase to 30%. This will remain the case until the newly agreed upon treaty comes into force.
We apologise for all inconvenience caused as a result of this error.
Feel free to discuss the changes below, and if you have any questions at all about the error or the change you can reach us at firstname.lastname@example.org.
For more information on US royalty withholding tax you can view our announcement here: http://inside.envato.com/usa-tax-withdrawal-changes/