Why do ebooks have vat

RNIB's head of social change, Sarah Lambert, said it was disappointing that the tax break was not being extended to audiobooks. Publisher Ink tweeted the "huge" decision would allow it to sell e-books from its website again.

In response to the news, it said: "We are delighted that the government has decided to zero-rate VAT on digital books and journals in the Budget. It's fantastic that the Chancellor has acknowledged the value of reading. When this eBook store closes, your books disappear too. How digital publishers are shaking up the book industry. He and I have been arguing on Twitter , very politely I might add, about this as I think he's got it wrong. Where I do agree with Anthony is regarding Amazon's monopoly when it comes to e-books.

That is a monopoly, pure and simple. But are they ignoring the VAT cut and pocketing the difference? Sure, there were still lots at 99p price points, and I assume Anthony viewed those as evidence of Amazon shenanigans, but there is a perfectly logical explanation for this.

Publishers tend to sell books to Amazon in one of two different ways, using a wholesale or agency model. With the wholesale model, the publisher sets a wholesale price for the e-book — usually an amount that, once VAT is added, results in a. The other prevalent model is the agency model, where publishers set an RRP — again, nearly always a 99p price point — and the retailer sells at that price and deducts a commission. Here the publisher has determined the selling price, in much the same way as they do with RRPs on printed books.

Member states have been free to do so since December 4, The court holds that the supply of electronic books is such a service. After this ruling was issued calls for the EU to amend laws to take into account technological change grew louder. During and into - as a result of the directive mentioned above - a host of EU member states amended their VAT systems to apply reduced rates to electronic publications. Resources Library. Sudden and unexpected changes In the United Kingdom there was a surprise announcement on April 30 to scrap the VAT rate on e-publications.