Both incorrect based on my experience.

Hammer is 20%, then you pay 22.5% vat on that hammer premium.

All pay VAT. Then, when you receive the item in the USA, you can scan and send lots of paperwork back to Holts and get a VAT refund. Your VAT refund will be less than the cost of the inbound wire transfer fee to receive the money, so call it all lost.

I've done all of this many times.