Quote:
Originally Posted by pdurrant
Strictly speaking, Amazon don't dodge UK VAT. As a non-EU company, they're allowed to choose where to register for VAT in the EU, and they chose Luxembourg.
I suspect that the increase in electronic goods will lead to the tax authorities deciding that the tax to be paid should be the rate in the purchaser's country, not that of the seller.
And we'll then have the anomalous situation that the point of sale is the vendor's location, but the tax paid will be based on the purchasor's location.
And it'll be some years before things settle down....
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"allowed to choose" I understand that Waterstones could do the same just by setting up a Luxenbourg subsidary company for downloads just as Amazon did.
Browsing the EU's site, I found that "rate in the purchaser's country" had already been agreed but not until 2015 !
And for printed books and other goods by Mail Order Amazon.co.uk already do it that way and charge EU customers at their country's VAT rate as soon as sales to that country exceed the VAT threshold.