France, Germany, Italy and Poland call for low VAT on ebooks
The UK has been left as the last major supporter of higher VAT rates on e-books.
Today, France, German, Italy and Poland called on the European Commission (EC) to enable member states to levy the same reduced VAT rate on e-books as they already can on printed books. The countries call on the Commission “to end discrimination against digital books” as the member states seek to build the digital economy. The statement from the countries was coordinated by France which currently charges 5.5% on e-books whereas the UK charges 20%.
UK left isolated on ebook VAT
The statement from 4 of Europe’s largest 5 countries comes as the European Court of Justice two weeks ago ruled on e-book VAT that Luxembourg and France were in contravention of the EU VAT Directive by charging reduced VAT rates of 3% and 5.5%, respectively on e-books. The ECJ ruled that e-books were services and not goods, and were not mentioned in Annex III of the Directive as being entitled to a reduced VAT derogation. They are now required to raise the charge to their standard VAT rates of 17% and 20%, respectively.
Italy has reduced its ebook VAT rate from 22% to 4% at the start of 2015. Poland had pushed for an ebook VAT cut consensus in 2013 when it held the Presidency of the European Union.
The UK has been isolated by the action of the other major member states. It had pushed the EC to rule on the French and Luxembourg reduced rates, and probably thought the matter was closed with the victory two weeks ago.
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