VAT on e-books ...... Kindle etc.

Discussion in 'Funster Book Club' started by bryandh, Aug 1, 2013.

  1. bryandh

    bryandh Funster

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    Walk into any High St bookstore, Waterstones / W.H.Smith etc., buy a hard back, paper back, magazine, newspaper and at the cash desk no VAT is chargeRd. Buy the same product on line from , (say), Amazon for electronic transmission / download and VAT is charged. Why?

    Basically because of the crazy tax structure which exists in the UK as such electronic purchases are deemed to be "services" and therefore taxable.

    Link this taxation with the artificially maintained high prices of e-books by the online publishers, given that no printing/transport/distribution costs are involved and I suggest the e-book readers are being roundly ripped off.

    Not much can be done about the second part of this post but do you agree that:-

    " e-books and other reading materials should be exempt from VAT"
     
    Last edited: Aug 1, 2013
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  2. GJH

    GJH Funster Life Member

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    Zero rating of books and other publications was (if I recall correctly) a deliberate decision taken in order not to put people off reading and education.

    Obtaining books in Kindle (or other electronic) format is a personal choice we make knowing that the price includes VAT. We don't have to choose e-books, hard copies are still available - but the point is that it's our choice.

    It's exactly the same with food. We can buy fresh and prepare it ourselves and pay no VAT but if we choose to have somebody else prepare it then we have to pay tax.

    I see nothing wrong with that at all. We have a free choice and we take the one which suits us.

    Any wrong comes in profiteering by e-book publishers in exactly the same way as it does in profiteering by oil companies inflating the cost of road fuels at holiday times.
     
  3. TheBig1

    TheBig1 Funster Life Member

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    I completely agree that any form of book or information exchange should be exempt from tax. taxing learning is inherently wrong and restricts the availability to those that can afford it
     
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  4. bryandh

    bryandh Funster

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    You are quite correct that books etc., were zero rated so that reading and educational aids were not penalised. However, if my memory serves me well, that decision was made 30-40 years ago long before the technological explosion which brought computers and other electronic devices into almost every home in the land.

    It is time therefore for this anomaly to be addressed, free choice has nothing to do with it, it is still a taxation on reading, education and simple pleasure of reading in the format of your choice.

    An ecological argument could also be presented, but that is ...... another story .......... for another time/place





    Regards, Bryan
     
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  5. sedge

    sedge Funster

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    Hah - I'd leave it well alone if I were you.

    Bet your sweet bippy if they changed it at all, they'd start imposing VAT on real books too rather than the other way about.

    Yours

    Mrs Cynical
    Bedworth
     
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  6. Johns_Cross_Motorhomes

    Johns_Cross_Motorhomes Trader - Motorhome & Accessory Sales

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    Ah BUT no Vat on reading the magnificent Daily Mail as our Shiffty well knows!

    Peter
     
  7. GJH

    GJH Funster Life Member

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    There is another aspect to this which struck me after I posted.

    I mentioned on another thread the other day that I can't remember when I last paid for a Kindle book. I have had hundreds for free and still have nearly 400 I haven't read. I can't see that happening with printed books.

    Take the argument about technological advance to its logical conclusion and every household has to have a PC, tablet, Wii, Nintendo &c &c (mustn't discriminate against formats) paid for by the taxpayer - and that would demand a higher rate of VAT and other taxes.

    The fact is that those who want to use printed books are in the same position they always were. It can hardly be said, either, that readers of e-books are "suffering" as the cost of an e-book (including the VAT) is often less than the cost of a VAT free printed book.

    VAT on e-books is not a tax on learning, it is a tax on an individual's choice of format - a choice made freely despite knowing that the VAT element is there.
     
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  8. Daveg

    Daveg Funster

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    Ebooks

    One of the nightmares for librarians in Universities is finding ways to pay for electronic journals, which are critical in both teaching and research, because of the 20% VAT. To a great extent it really is a tax on learning and was so for many years before the ebook took off as a consumer item.

    Electronic publishing is a beautifully designed mechanism for printing money and the government isn't going to give up its share any time soon.

    Dave
     
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  9. GJH

    GJH Funster Life Member

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    So persuade the publishers to publish using traditional print then. Just because a product is only available in one form does not necessarily mean that it should not be taxed.

    Hang on though. Why are these journals only produced electronically? Could it be that they would be a heck of a sight more expensive to produce in printed form? What would that do for university budgets?

    In fact I expect that the situation is similar to the publication of facsimile directories and suchlike by genealogy supplies companies. There were a few produced in book form a few years ago but the availability only really took off when it was possible to publish on data CDs & DVDs and, subsequently, through subscription web sites. As such they attract VAT but the alternative is that they will simply not be published. Extend that to journals and what would their not being published at all do to teaching and research?

    VAT on electronic publications is no more a tax on education in universities than is the VAT on any other items which do not qualify for reclaim.
     
  10. Daveg

    Daveg Funster

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    Publishers

    The point is that they only sell you the electronic version if you take the print copies as well. There has been debate on this (worldwide) for years, but nothing seems to get any better. Academic publishing is a cartel and is vastly profitable because the costs to the publishers are low. The research is done at public or charity expense. Academics write, edit and validate the articles. Libraries are obliged to buy the journals at huge expense because they are the bread and butter of teaching and research.

    I'm glad I don't have anything to do with it any more :Smile:
    Dave
     
  11. GJH

    GJH Funster Life Member

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    So they would be expensive even without VAT then :Smile: And it is quite within the power of the publishers (if they want to show their support for their fellow academics) to reduce the price :Smile:

    I can fully understand why you feel well out of it :Smile:
     
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  12. WillH

    WillH Funster

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    To take a longer view on the VAT debate we should look at other countries. I was in Canada when they introduced VAT on books, public outcry, then they just got on with life, this is the country where they pay no VAT on fuel or alcohol!

    In many countries VAT is paid on fresh food, something we would rail against here. Also, many countries have higher VAT rates than we have here. Given, as pointed out above, many e-books are downloaded free, and the cost of an e-book is generally much less than the printed version, paying VAT is no real hardship. We also pay VAT on e-readers at the point of purchase.

    I have always been an advocate for indirect taxation (i.e. VAT rather than income tax) as this gives a consumer/earner the choice on how much tax to pay. Some countries in the developing world are moving towards this now with over 50% of their tax revenues being generated by VAT or sales taxes.

    The government needs to raise taxes to pay for everything, whether you agree on what they spend it on or not, and VAT is just another tool, remember we used to pay car tax and then purchase tax on the car tax!

    Bill
     
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  13. beachcaster

    beachcaster Read Only Funster

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    The music industry has been decimated because the big players..who sign acts and distribute cds had tunnel vision when it came to downloading music on the web


    They wanted 13 quid for for a cd...which they had to manufacture and distribute with at the huge costs involved.
    The wanted the same price for downloaded music where the setup cost to download 100 copies is the same as a million copies.

    Its a greedy model they stuck with........and pirating has all but destroyed them. Serves them right!

    The same will happen with books.......its not just VAT its the cost of a digital book itself which is outrageous.
    This will come back and bite the greedy publishers in the fullness of time.

    Who is better off.....the guy selling a book for a tenner to a thousand customers
    or the guy selling the same book ( or music) for a quid to a million customers ?
    That is what the internet can give you .


    The wonderful thing about the internet is the kids find new ways around the old ways of doing things......

    ban file sharing....impossible.......ban porn impossible

    Come up with realistic busines models to get youngers onboard and you will have a winner.

    As for polititians .....they are decades behind with their understanding..and ability to see the future

    barry
     
    Last edited: Aug 2, 2013
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