Tag Archives: HMRC

Why do we pay VAT on eBooks but not on print books?

There’s no VAT charged on books – it’s one of a number of exempt products and services that the HMRC sets to be zero rated (For the full list – click here).

…but there is on eBooks. I’ve been searching for an answer as to why (and indeed, why print books are zero rated). I can only assume that – as books broadly speaking ‘better’ or are needed for civilized society, a view was taken that they should be zero rated and that’s been maintained over the years.

As to why eBooks aren’t zero rated? The suggestions I’ve read online indicate that legislators haven’t quite caught up with the concept. Would they be taxing a digital download/service, or a ‘book’ in the traditional sense? In the case of Kindle, you aren’t buying the book but the right to access it from Amazon – so how is that classified by the bean counters?

Irrespective of the logistics of it and whether they should be zero rated or not, this is why the pricing on eBooks is so broken. It is almost inevitably cheaper for me to buy a hardback on Amazon than the Kindle equivalent (given Amazon’s extensive discounting of new mass-market hardback novels). Frustrating, but I’m still paying the digital tax – the convenience of e-reading – not to mention the enormous amounts of shelf space it’ll save me in the long run – is immense.