Shop free world, do we care?

The high moral tone some have adopted here amuses me. People are actually upset that HMRC is not getting its “fair share” as they would have it.

The upshot of the case is that all of us will pay more but will any of us see the benefit from the increased tax received? Not a chance.

I also sense that there is some confusion between the VAT corporations pay and the Corporation Tax they pay. VAT is a tax added to the value of what we all buy – like the old pre-EU purchase tax. In the case of VAT the seller collects the tax from the buyer and transfers it to the Treasury. Whether the seller levies the tax at 3% or 20% it is of no benefit to the seller.

Hi All,
On-line buying is a god send for me as I suffer from agoraphobia but I will admit I do miss the buying from shops, both have their advantages and disadvantages.

Geoff.

No, Taxes are being paid, just not in the UK.

I pay my ebay fees every month, but pay Luxembourg rates, not English. Now, I don’t mind that too much, as it makes it a bit cheaper for me, but if you add up the lost revenue, it makes a fair difference.

Personally, I believe that if you market goods or services in a specific country, AND have a base of some form in that country, then you have to pay the taxes that are generated in that country. For the big companies that isn’t very common.

Bruce

Bit two faced Bruce OK for you to save a few quid but not OK on a larger scale?

If I have read that wrong its the Gordon’s and tonic in ample quantities!

No, Taxes are being paid, just not in the UK.

I pay my ebay fees every month, but pay Luxembourg rates, not English. Now, I don’t mind that too much, as it makes it a bit cheaper for me, but if you add up the lost revenue, it makes a fair difference.

It isn’t tax avoidance – it is aggressive tax manipulation though, and many large companies pay an absolute fortune for a service that cuts their tax liability across the world.

Personally, I believe that if you market goods or services in a specific country, AND have a base of some form in that country, then you have to pay the taxes that are generated in that country. For the big companies that isn’t very common.

Bruce

Oh come on! So now we all to be arbiters of goid and bad law are we? Anarchy ensues. For good or ill we live in a world and abide by its laws. If the laws are judged bad by some people they should set about changing them.

I repeat in this case taxes are NOT being dodged. The phrase is meaningless. In reality as someone has already posted the law has been changed to prevent the previously legal application of the law, so you should be delighted. Your ebooks will cost you more though!;)

Just because something is legal does not make it RIGHT!!! They are ARE tax dodging, they use armies of lawyers to acheive this. The government are weak and ineffective, unwilling to take on the dodgers.

PM

They are not tax dodging, they are acting quite legally within the tax framework available. It is neither disgusting nor immoral nor any of the other indignant sanctimonious epithets the gutter press is so eager to apply.

If you don’t like the tax laws direct your ire to government – they make the laws!!

Businesses like individuals will take advantage of the most tax efficient arrangements available. Nothing wrong with that whatsoever.

No…?? Its disgusting…… A strong goverment is required which will take on ALL the tax dodgers, particularly the large ones.

PM

I’m afraid I don’t agree with your last paragraph Chas. I have lived over 40yrs in what once was a thriving but small Market Town. Many shops we had, as you have in where you live. But slowly, Council Tax has caused most of the shops to close. That is when property developers buy these closed shops, and turn them into Flats, for E.U. Immigrants. It has been stated, that we have more Takeaway shops, than any other town in England. We have one Butchers shop, but used to have 4, fruit shop, gone, it has become a ghost town, and on a good windy day, one can see Sage Brush rolling down the streets.The only thriving shops in town now, cater just for the Poles, Ukrainians, Lithuanians etc, so the E.U. hasn’t helped my town, where 1 in 5 foreigners have moved in.
Jim.
Lincoln .7

Picking up on an earlier point in the local town we are blessed with REAL shops – greengrocers, butchers, fresh fish shops as well as coffee shops and a book shop. All privately owned where you can buy fresh seasonal produce in expensively.

The town thrives but so many do not and I hope I do not live long enough to see the death of the traditional shop where service and good quality are paramount.

Internet selling has got a very long way to go before it usurps terrestrial shopping and perhaps it will one day in the distant future and maybe my grandchildren will live to see the day…..

Lower electricity bills!!?? Best joke of the morning!

A shop free world, hmm, can you imagine a world free of neon signs….YEH!! a world therefore with an over supply of electricity….YEH!! a world of lower electricity bills…YEH!!

Pity I won’t be around to see it.

Have a read of these paragraphs.

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_ShowContent&propertyType=document&id=HMCE_CL_000102

I remain confused. Books are zero rated in the UK anyway.

Does this mean on-UK residents don’t have to pay VAT for internet/mail/phone ordered books?

Fascinating stuff -thanks for posting the link. It only goes to illustrate just how complex and confusing the cross border taxes are levied.

And one thing’s for sure the increased tax will be taken in to the sales price just as it always is as noted in Amazon’s terms as referenced above, by every retailer. It has to be because the supplier is collecting the tax on behalf of the treasury so is bound to charge the end user.

It seems this particular loophole has been closed…..well, from 1st January 2015 anyway.

http://thebookseller.com/news/e-book-prices-may-rise-vat-law-kicks

The move prevents Amazon, Nook and Kobo from applying a low 3% tax on e-books sold to European countries, because their headquarters are in Luxembourg. Instead, the e-book retailers will have to apply the standard UK VAT rate (20%) to e-books sold into the UK. As a result, Luxembourg stands to lose around €800m a year from the ruling, while the UK and Germany stand to gain around €350m each per annum.

Presumably this not only applies to e-books but all other ‘virtual’ media?

I am trying to reconcile this from Amazon with your contention. Can you help?

“Help & Customer Service
Payment, Pricing & VAT › VAT & Invoices›
About VAT on Sales by Amazon

VAT is charged on sales by Amazon within the European Union (EU).

In accordance with the laws governing members of the EU, Amazon is obliged to charge VAT on all orders delivered to destinations in member countries of the EU. VAT is charged in accordance with the local legislation in each member state.

The Recommended Retail Price (RRP) and/or price displayed for goods sold by Amazon are inclusive of UK VAT. However, your final price may differ depending on the actual VAT rate that applies to your order. For orders to other EU countries, the UK VAT amount will be deducted and the applicable VAT rate for the destination country will be added. Your final price during checkout will reflect the correct VAT rate for the destination country of your order.

See How to purchase as a VAT registered customer within the EU if you want to use your VAT registration number when purchasing from Amazon.

Invoices for items that are subject to the Margin Scheme for second-hand goods will not show a VAT breakdown, and the invoice will state that the item is subject to the Margin Scheme for second-hand goods. For more information on this scheme, please refer to “The VAT Margin Scheme and global accounting HMRC Notice 718 (April 2011)”.

With total online sales being about 10% of all sales, the lost VAT revenue ( if that is actually the case) from Amazon’s ebook sales is less than a drop in the ocean. Hugely greater amounts of revenue are lost in other areas. Storm in a teacup suggests itself.

I remain confused. Books are zero rated in the UK anyway. And if you are a seller from one EU nation to another you cannot levy VAT as an exporter.

True, but I think Amazon sell more e-books than books and e-books are 20% VAT rated in the UK…

…it is a grey area since the e-books and the on-line transaction take place in ‘cyberspace’!

The assumption being made, is that everyone has access to the Internet.