Hoping that you are taking care and staying home I have an update on some changes that Patreon is passing through that involves the supporter's community.
As some may know there's been multiple changes and additions on tax laws in several countries and the US states that are aimed at the e-commerce and stream platforms, due to these new laws Patreon will be required to start charging sales tax on some pledges starting from July 1st.
By gathering the information that was sent to me and how this would affect the platform, I aim to explain and make as clear as I can the small changes that the pledge system will go through.
First of all, you may be wondering what part of Patreon's service is subject to be taxable? To put it in simple words, the benefits you are pledging to. These benefits (for example; stream content, digital goods, behind the scenes, download exclusives, etc), can be taxable if the law of the country you live says so but, that doesn't mean everything will be taxable, and if so, the amount will be very small.
For example, if the tier you're pledging has a taxable benefit in your country (United States for instance), such as "downloadable content" listed for digital art, the sale tax rates in the US range from 4% to 11% depending on the state, which means on a 5$ pledge, that would be between 20 cents and 55 cents tax.
So, like I said the only way a pledge will have a tax addition will solely depend on the country you live on and their take on tax sales (what's taxable or not), so this means they won't be taxable in every location, and only a fraction of the pledge will be taxable for them.
Following the last point, what do I mean with only a fraction? Depending on the kind of benefit you are getting by your pledge, this will may or not come with a small fee, but the case is there are multiple benefits you may be getting from one tier and only one of these benefits is taxable in your country and the other is not making this fee even smaller in most situations, and here is where content creators can make even a bigger change for their supporters/patrons.
Like I said before, there may be multiple benefits listed in only one tier that you are pledging to, in other words, these benefits represent each one a percentage of the total pledge rounding up to 100% between them, with this in mind content creators can manipulate manually each field to give a bigger or a smaller representation of the whole pledge which in return will translate into how much the tax of that benefits will be shown to you.
For example, in the tier that you pledge, there are two different benefits, one taxable in your country and the other is not (for instance; download content and early access content), between them they represent the 50% each of the whole tier, meaning that 50% of the price of your pledge will go through tax fee.
But this doesn't end here, it's more than known for Patreon that 40% of the supporters most likely want to support artists by the sole purpose of wanting to help them which by all means it's something that is not taxable, and they want to give as much credit as they can to supporters that pledge not for the benefits but just to help content creators. By this, there is another benefit I added name "general support" that represents a big percentage of the whole tier giving a helping hand to lower even more tax sales for patrons by adding more no taxable fields so the impact is minimal.
By all means I will be working closely with Patreon to ensure I'm able to save you as much money as possible.
I know this may not be as informative as it should be but I wanted to give a heads up of what's coming on July 1st so you are aware of these changes way ahead. If you live in a location where tax sales will be required you should expect to receive an email from Patreon with more information about this very soon.
I hope I could be of some help to you, thank you all so much for your support.