With 2015, a new European Community regulation come into being, stating that VAT on digital contents will be calculated based on the country of purchase.
This is extremely stupid – as it hits small businesses, cottage companies and small publishers, forcing them to keep a separate accounting for VAT based on the countries in which their products are sold.
This, because European Community countries do have each a different VAT regime for digital contents – ranging fro 4% to 23%.
The new rule was apparently introduced to solve the problem of Amazon’s tax dodge (Amazon being VAT-registered in Luxembourg) but the effects are horrid – and do not hit Amazon, but readers and publishers.
In Italy – where I live – VAT for ebooks used to be a staggering 22%.
No matter where I purchased my ebooks, that would be the extra for me to pay. Continue reading