Written by Dan Conway, Head of Public Affairs and Research.
Today is a hugely significant day for UK readers. As of today, which we’ve dubbed ”eVAT Freedom Day”, the UK is finally able to end a longstanding inconsistency between the way digital and print publications are taxed. Now it is for the UK government to decide whether it will keep pace with other European nations and act to implement this long-awaited legislation.
The antiquated Directive 2006/112/EC has been amended by Council Directive (EU) 2018/1713 so that now readers of online books, journals, magazines and newspapers may no longer have to pay a 20% tax that does not apply to print editions. From the outset the VAT regime has always exempted print books on the basis that taxing knowledge was bad for society and now finally we have a chance to bring this principle into the digital age.
So what next?
Freedom for readers?
41% of the UK population borrowed, bought, downloaded or gave an ebook as a gift last year. Meanwhile, 80% of children read ebooks compared to 60% of children who read books in print. People should not have to pay more for a book just because of the way they choose to read it, and we are thrilled that this injustice can now be rectified.
Freedom for the UK’s most vulnerable?
The current discrepancy hits vulnerable groups hardest. For example, those with visual impairments rely on audiobooks and digital texts with accessibility settings, whilst disabled people unable to handle print books often find ereaders easier to hold. Evidence also suggests that low earners (under £24,000 per annum) currently constitute one third of ebook readers. It’s time that the discrimination against these groups is brought to an end, leaving everyone free to read in the way that suits them best.
Freedom for public institutions?
Universities, libraries, government departments and the NHS are just some of the institutions currently paying VAT on epublications – in fact, estimates suggest that £55 million is being spent per year paying for VAT on digital publications. At long-last we have a chance to end this illogical cycle of cost in the public sector.
Freedom for businesses?
Zero-rating VAT on digital publications would reduce unnecessary bureaucracy that currently burdens publishers and digital content businesses.
So today we are calling on the UK government to utilise its new powers and #AxeTheReadingTax. In doing so, the UK will show the world that our country is serious about building a forward-thinking digital economy, cementing our position as a literary nation that encourages readers of all background and ages.
We hope you will join us in celebrating eVAT Freedom Day, and that you will consider supporting our efforts to free the UK’s readers from this tax once and for all.