There's no VAT on books, is there? I hear you enquire. That's right, there isn't, unless these books are in digital form, in which case, in their infinite wisdom the HMRC have decided they need to charge the consumer 20% on their reading pleasure. (As if we struggling indy writers didn't have enough troubles on our plate.)
|The Englishman costs £1.91, |
with zero VAT it'd cost just £1.59
But it's not as simple as that.
HMRC have publicly claimed that if they have to change the VAT on e-books they will also have charge VAT on physical books. In other words, parity will mean VAT would be charged on all books, whether digital or physical. Obviously no-one wants this.
The tax man has pointed out that it's illegal under the European Court of Justice to extend UK's scope of zero-rated VAT. But the lawyers BLP argue that removing 20% VAT from e-books means that the Government would only apply an existing concept (of zero rated VAT) to a new technology product in the same category.
I sincerely hope that BLP win their case and 20% VAT is removed from e-books. To me, as an accountant and a novelist, it makes no sense at all to charge VAT for one but not for the other.