Stupid UK Tax on E-books

mattlynn · 10-01-2011, 11:46 AM

E-Books are the best thing that have happened to writers since…well, probably the invention of instant coffee. Sure, there is a lot of nervousness among publishers and bookshop owners and that is understandable. But for writers, they can only be good news. At the flick of a switch, you have a global market. Far more of the money generated goes to the writer. And it opens up markers for all sorts of new kinds of work.

There is one glaring injustice, however. E-books carry VAT, whereas printed books are tax-free.

That is just short-sighted greed on the part of the Treasury. A petition has been started up on the government’s website calling for its abolition. As it rightly points out, e-books are far more environmentally-friendly than the old, paper sort. No trees get cut down. No vans drive them around the country. A book is a book, regardless of the form of delivery. It is crazy to discriminate in favour of one kind through the tax system.

I’d add another point. I bet e-books can be a huge industry for the UK. We have great writers, English is the world’s language, and we have the editors and entrepreneurs who can seize the market. And yet the Government is taxing e-books unfairly – which almost certainly means the industry won’t develop as fast as it otherwise would. Bonkers.

I’ve already signed the petition, but there are only 2,500 so far. So click on the link and add your name today.

[Promotional in-text link removed - MODERATOR]

mr ploppy · 10-01-2011, 11:52 AM

If you have a Kindle it is the Luxemborg government you need to petition because that is who gets your ebook VAT.

HarryT · 10-01-2011, 02:23 PM

Quote:

Originally Posted by mr ploppy

If you have a Kindle it is the Luxemborg government you need to petition because that is who gets your ebook VAT.

I don't believe this is correct. If you buy an ebook from Amazon and look at the invoice for it you'll see that you've been charged the UK VAT rate of 20%, not the lower Luxembourg rate.

HarryT · 10-01-2011, 02:26 PM

Matt,

The British government has no say in this matter. It's required to charge the full rate of VAT on downloaded items by the EU's "e-commerce VAT directive". No EU member state is permitted to tax e-books at a reduced rate.

mr ploppy · 10-01-2011, 04:04 PM

Quote:

Originally Posted by HarryT

I don't believe this is correct. If you buy an ebook from Amazon and look at the invoice for it you'll see that you've been charged the UK VAT rate of 20%, not the lower Luxembourg rate.

This is what it says when you set your ebook price on Amazon:

"The list price you provide is VAT-EXCLUSIVE. The VAT we will add for sales to customers in EU countries from amazon.co.uk and amazon.de will be 15%. VAT rates, where applicable, vary for other countries."

I have mine set at £1.73, which gives a total price on Amazon UK of £1.99.
15% of £1.73 is (near enough) 26p.

HarryT · 10-01-2011, 04:14 PM

Quote:

Originally Posted by mr ploppy

This is what it says when you set your ebook price on Amazon:

"The list price you provide is VAT-EXCLUSIVE. The VAT we will add for sales to customers in EU countries from amazon.co.uk and amazon.de will be 15%. VAT rates, where applicable, vary for other countries."

I have mine set at £1.73, which gives a total price on Amazon UK of £1.99.
15% of £1.73 is (near enough) 26p.

You're absolutely right - I stand corrected. I've just looked at an invoice for one of my Amazon eBooks and it says on it "Sold by Amazon Media EU S.à r.l.", which is, I believe, Amazon's business in Luxumbourg.

This seems to be purely for eBooks. "Normal" stuff certainly gets charged at 20% VAT.

Thanks for the info on this - I've learnt something new!

wallcraft · 10-01-2011, 08:33 PM

Quote:

Originally Posted by HarryT

"Sold by Amazon Media EU S.à r.l.", which is, I believe, Amazon's business in Luxembourg.

That is really smart business by Amazon, but I wonder how they get away with it. The nexus of an ebook sale for copyright license purposes is where the buyer lives (or where their credit card lives), so how can it be Luxembourg for VAT purposes? I suppose the answer is that the law does not have to make sense.

JeremyR · 10-01-2011, 09:55 PM

Quote:

Originally Posted by HarryT

Matt,

The British government has no say in this matter. It's required to charge the full rate of VAT on downloaded items by the EU's "e-commerce VAT directive". No EU member state is permitted to tax e-books at a reduced rate.

Wow, did you guys lose a war or something when we weren't looking?

HarryT · 10-02-2011, 02:47 AM

How do you mean? Didn't you know that the EU had rules that its members have to follow?

mr ploppy · 10-02-2011, 05:17 AM

Quote:

Originally Posted by JeremyR

Wow, did you guys lose a war or something when we weren't looking?

We won 2 world wars and a world cup, but we really should have been watching the men in suits more closely.

Kubizo · 10-02-2011, 01:33 PM

In Italy the VAT is 10% on printed books and 21% on e-books. Talk about environment friendly regulation... :-(

10-01-2011, 11:46 AM	#1
mattlynn Member Posts: 21 Karma: 63854 Join Date: Jul 2011 Device: kindle	Stupid UK Tax on E-books E-Books are the best thing that have happened to writers since…well, probably the invention of instant coffee. Sure, there is a lot of nervousness among publishers and bookshop owners and that is understandable. But for writers, they can only be good news. At the flick of a switch, you have a global market. Far more of the money generated goes to the writer. And it opens up markers for all sorts of new kinds of work. There is one glaring injustice, however. E-books carry VAT, whereas printed books are tax-free. That is just short-sighted greed on the part of the Treasury. A petition has been started up on the government’s website calling for its abolition. As it rightly points out, e-books are far more environmentally-friendly than the old, paper sort. No trees get cut down. No vans drive them around the country. A book is a book, regardless of the form of delivery. It is crazy to discriminate in favour of one kind through the tax system. I’d add another point. I bet e-books can be a huge industry for the UK. We have great writers, English is the world’s language, and we have the editors and entrepreneurs who can seize the market. And yet the Government is taxing e-books unfairly – which almost certainly means the industry won’t develop as fast as it otherwise would. Bonkers. I’ve already signed the petition, but there are only 2,500 so far. So click on the link and add your name today. [Promotional in-text link removed - MODERATOR] Last edited by Dr. Drib; 10-07-2011 at 12:01 PM.

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10-01-2011, 11:52 AM	#2
mr ploppy Feral Underclass Posts: 3,622 Karma: 26821535 Join Date: Jan 2010 Location: Yorkshire, tha noz Device: 2nd hand paperback	If you have a Kindle it is the Luxemborg government you need to petition because that is who gets your ebook VAT.

10-01-2011, 02:26 PM	#4
HarryT eBook Enthusiast Posts: 85,544 Karma: 93383043 Join Date: Nov 2006 Location: UK Device: Kindle Oasis 2, iPad Pro 10.5", iPhone 6	Matt, The British government has no say in this matter. It's required to charge the full rate of VAT on downloaded items by the EU's "e-commerce VAT directive". No EU member state is permitted to tax e-books at a reduced rate.

10-02-2011, 02:47 AM	#9
HarryT eBook Enthusiast Posts: 85,544 Karma: 93383043 Join Date: Nov 2006 Location: UK Device: Kindle Oasis 2, iPad Pro 10.5", iPhone 6	How do you mean? Didn't you know that the EU had rules that its members have to follow?

10-02-2011, 01:33 PM	#11
Kubizo Connoisseur Posts: 96 Karma: 54908 Join Date: Oct 2011 Location: Milan Device: Kindle 3 B008 3.1	In Italy the VAT is 10% on printed books and 21% on e-books. Talk about environment friendly regulation... :-(