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Europe may offer VAT break for ebook and enewspaper industry


WEBWIRE

As part of a range of measures to help the struggling European newspapers and book industries, the European Union is looking at reducing the VAT rates on electronic print. This could provide a boost for news and book publishers on e-tablets, the internet and CD Books.

EU to eliminate VAT penalty on electronic publishers

In almost every EU member state, printed books and newspapers incur a reduced VAT rate. However, most countries impose the standard higher rate on electronic material. See below for some examples of standard VAT rates and reduced rates on printed materials. For example, in the UK printed material is taxed at 0%, but electronic at 20%.


Country Printed VAT rate Electronic VAT rate

Belgium 6% 21%
France 5.5% 19.6%
Germany 7% 19%
Ireland 0% 21%
Spain 4% 18%
UK 0% 20%

The European Commission this week indicated that it is reviewing this, and may move to allow reduced VAT rates on electronic services. The EU Director General for Education and Culture, Jan Truszczynski, commented “We believe content should be taxed the same way, whether printed or in tablet”.

Richard Asquith, Head of VAT at the TMF Group commented:
“The EU Commission is concerned with the sharp decline in the print industry, and is anxious to help subsidise the sector. The problem with direct subsidies is the political ramifications of being seen to underwrite many news publishers. Ironing out this tax anomaly would be a simple way to help the industry without directly interfering.

TMF Group provides global accounting services, and operates through 87 offices in 67 countries. http://www.tmf-vat.com/


Contact:
Richard Asquith
Head of VAT
TMF Group
UK
Tel: +44 (0)870 067 8881
Fax: +44 (0)870 067 8882
richard.asquith@tmf-group.com



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 VAT
 Tax
 Europe
 EU
 Compliance


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