We need to talk about upcoming tax changes on Patreon! (Patreon)

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Heya guys!

I was notified recently about changes Patreon is moving forward on that's most likely going to affect how much you are charged at the beginning of each month! Due to new laws passing in several countries and several states in the USA, Patreon is required to start charging sales tax on some pledges starting July 1st. 

Less than half of all patrons will be charged sales tax, and for most, the amount will be very small. For example, sales tax rates in the USA range from 4% to 11%, so on a $5 pledge, that would be between 20 cents and 55 cents. 

Whether or not you will be charged sales tax depends on your location, and what is considered taxable there. Not every pledge is taxable, not all benefits are taxable in every location, and sometimes only a fraction of a pledge will be taxable. The money that Patreon collects as a result of these laws are paid directly to local governments.

If you’re in a location where sales tax will be required, you should expect to receive an email from Patreon with more information about this very soon, but I wanted to make sure you were aware of these changes way ahead of July 1st when they go into effect. 

If you have questions, you should be able to find answers here. If you still have questions, the best place to get an answer is from Patreon’s customer support team, here. 

Thank you for all of your support!
~Dzahn

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Alright, above is a slightly modified version of a message Patreon recommended we send to patrons. I'd like to talk a bit more deeply about the issue, though, if you don't mind!

I've been looking over the new regulations trying to get a grasp on what's going on, and I'm figuring out what the most ideal way to save you all money would be. There are certain aspects of the new system that I think are going to be pretty unfair to long time patrons.

For example, for those who this applies to, you will be charged tax on the monthly builds we release depending on the valuation we provide. This means you will be charged a tax percentage on top of the minimum $3 pledge you are paying. To counteract this, I am planning to add a $1 tier for Santa Lucia, which will theoretically reduce the "valuation" on builds and save you money.

The big issue I have is how this new system means you will be paying tax monthly on benefits we provide on rare occasions, such as the short stories for the Juniors and Seniors. At the moment we only have one short story, and I don't believe it is fair for you guys to be charged tax on it monthly when we don't have the capacity to put out more at an increased frequency. As such, I believe I have found a way to avoid this issue entirely.

Long story short, in order to accommodate these changes and ensure you're not being charged more than you have to, I am going to update the pledge tiers we have on offer. The updated tiers won't be made live until sometime next month, but I wanted to give you all a heads up as to what's going on.

Here's the plan:

$0 - Public
+ Access to previous month's build on the 1st of every month

$1 - Guest
+ Access to current month's build on the 15th of every month (two weeks later than patrons of higher tiers)
+ Discord access

$3 - Freshman
+ Access to current month's build on the 1st of every month (standard)
+ SFW Art packs and previews
+ Name in credits

$6 - Sophomore
+ NSFW art packs and previews
+ Song previews

$10 - Junior
+ Gallery pass (Includes music room, short stories, cg gallery, etc,.)
+ Link to downloadable versions of the soundtrack songs

$15 - Senior
+ Behind the scenes content like concept art, character sheets, notes, etc,.
+ Special mark on name in credits

As you can see, I've tried to simplify things so the tiers are easier to understand. I have also decided to make the gallery exclusive to our higher tier patrons since its value has gone up considerably with the addition of the short stories. Overall, I am trying to give everyone the most bang for their buck under these new regulations.

I hope you guys understand and have a wonderful rest of the day!
~Dzahn