Wednesday 7 December 2016

Move to slash VAT on e-books in schools

Published 02/12/2016 | 02:30

Thousands of schoolchildren now use iPads and tablets instead of textbooks. Photo: AFP/Getty Images
Thousands of schoolchildren now use iPads and tablets instead of textbooks. Photo: AFP/Getty Images

New rules being proposed by the European Commission could bring an end to high taxes on electronic school books.

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At the moment EU rules mean that all electronic publications have VAT of 23pc levied on them at the point of sale.

But there has been a long-standing practice in this country that VAT is zero rated on traditional school books.

Thousands of schoolchildren now use iPads and tablets instead of textbooks.

Downloading e-text books should be much cheaper than buying old-style textbooks, but the imposition of VAT at 23pc wipes out much of the gain.

The move is part of a Commission attempt to change e-commerce VAT rules across the trading bloc. As part of this, governments could impose the same VAT rate on electronic publications as print.

A Commission spokeswoman said: "E-books and other online publications would be charged the same reduced VAT rates as print publications."

Pressure

Educational publishers said e-book costs were 30pc cheaper than print publications, but the lower prices were being cancelled out by the 23pc VAT rate.

Up to 100 schools in the country are understood to use e-books.

The proposed changes by the European Commission would mean equal rules for taxing e-books, e-newspapers and their printed equivalents.

"Current rules allow member states to tax printed publications such as books and newspapers at reduced rates or, in some cases, super-reduced or zero rates," the Commission spokeswoman added.

"The same rules exclude e-publications, meaning that these products must be taxed at the standard rate. Once agreed by all member states, the new set-up will allow - but not oblige - member states to align the rates on e-publications to those on printed publications."

The Department of Finance has long blamed EU rules for the fact that it has to impose VAT on e-textbooks, while printed textbooks are not taxed.

Dublin MEP Brian Hayes said there would now be pressure on the Government, if the rules were adopted, to reduce the VAT rate to zero on e-textbooks.

Irish Independent

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