88% of respondents to our poll on ebook VAT say that they UK government should have cut the tax in this week’s budget. Of this 88%, half felt VAT on ebooks should have dropped to zero (which is the level for print books) while the other half felt the level should have dropped to the 3% or 5% mark which is common in most European countries.
There was pressure on UK Chancellor George Osborne to reduce VAT on ebooks in Wednesday’s budget. Instead, he merely retained (as expected) the 0% rate on print books while saying nothing about ebooks. Campaigners fear that this will dampen the UK ebook market and drive investors such as Amazon away, although others suggest Osborne is right to protect print books in this way.
The EU could soon be stepped into the discussion, though, because of concerns that ebook and print books are essentially the same product and should therefore be taxed at the same rate. Many observers expect parity to be reached at some point in the next few years, although whether than means ebook VAT falling or print book VAT rising remains to be seen.