Is VAT recoverable from Amazon on Kindle books?

News Corp UK and Ireland Ltd v Revenue and Customs: [2019] UKUT 404 (TCCm applies?

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News Corp UK and Ireland Ltd v Revenue and Customs: [2019] UKUT 404 (TCC) implies that electronic books are zero rated. If the judgement is not overturned in the Court of Appeal or Supreme Court Amazon can reccover 4 yeras worth of VAT , and presumably will account for this to buyers of electronic books on Kindle?

Replies (19)

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chips_at_mattersey
By Les Howard
30th Dec 2019 19:07

I am sure that HMRC will appeal this decision.

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Replying to leshoward:
Psycho
By Wilson Philips
30th Dec 2019 22:22

And I’m pretty sure that even if they don’t Amazon will be under no obligation to refund VAT to customers.

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Replying to Wilson Philips:
RLI
By lionofludesch
31st Dec 2019 10:21

And I'm pretty sure that HMRC will be pleading "unjust enrichment" so everybody draws.

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By Tax Dragon
31st Dec 2019 11:43

lionofludesch wrote:

And I'm pretty sure that HMRC will be pleading "unjust enrichment" so everybody draws.

The record shows you beat me to it... though at my end we crossed in the posting. Is it just me, or do others see delays - sometimes of over 24 hours - in posts appearing?

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Replying to Wilson Philips:
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By Tax Dragon
31st Dec 2019 10:55

But it doesn't seem fair that Amazon should get the money. In fact it seems positively unjust.

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Replying to Tax Dragon:
RLI
By lionofludesch
31st Dec 2019 11:14

They won't. HMRC will keep it.

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By gillybean04
05th Jan 2020 15:11

What are they going to keep?

Amazon pay VAT on digital services/goods in Luxembourg. Unless they've finally managed to close that loophole also.

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Replying to Tax Dragon:
Psycho
By Wilson Philips
31st Dec 2019 12:49

It would depend on the closeness of Amazon’s circumstances to case law on both sides of the argument. Notably their pricing policy. If a retailer is compelled to set the retail price at the market rate (ie the same as that charged by non-registered vendors) the argument is that the output VAT is then a cost of the vendor and not of the buyer - therefore no unjust enrichment. But it’s far from as simple as that.

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By Tax Dragon
01st Jan 2020 08:59

Wilson Philips wrote:

But it’s far from as simple as that.

Being a simple dragon, the ins and outs of the arguments here are above my station. I will have to watch the case unfold in the courts, where it may well be headed.

I know it's an emotional, not a rational, reaction, but it sticks in the craw to think that Amazon could profit yet further at the expense of the UK taxpayer. I'd offer my services to HMRC for free, if I thought it would help. (Obviously also an emotional, not a rational, response... maybe a hangover from the events of 2019, which year wasn't always easy... and what bright spark put NYE immediately before New Year's Day?!)

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By carnmores
01st Jan 2020 09:28

Does all the vat go to amazon or some to other companies? If they win this case and i hope they do there is an opportunity for them to show goodwill by refunding the output tax to all customers. We shouldnt blame amazon too much its the tax law that is at fault

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By carnmores
31st Dec 2019 07:47

This anomoly in the law must be corrected. If i can give 2 examples re tax books, Tax Cafe give a free pdf with every purchase whereas Claritax charge VAT on a pdf version of a book and I'm not sure if you get a hard copy in those circumstances. To be fair to Claritax they were extremely helpful and managed to accomodate me.

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By carnmores
31st Dec 2019 12:34

You have to be quick to beat Lion to it, hes often answered my question before ive asked it. Hes terrific he asked me before Christmas (hope this is ok Lion) if i was going to dignitas he was bloody close because i broke my back skiing 3 days ago. I was lucky it was mid back not neck, i think Lion is esp lol

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Replying to carnmores:
RLI
By lionofludesch
31st Dec 2019 13:24

Skiing at your age, carnmores ?

You eejit !

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By carnmores
31st Dec 2019 13:41

Dont make me laugh it hurts like hell the morphine and fentanyl have been replaced by slightly less toxic preparations :-)

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By carnmores
31st Dec 2019 13:42

Been skiing since 1960 will get the hang of it soon

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By Tax Dragon
01st Jan 2020 09:27

carnmores wrote:

You have to be quick to beat Lion to it.

Not just Lion. I think it was JoF set the record (in regards to what I saw) last year. One of the sisters, anyway. She gave an answer, quoting a clarifying response by the OP to questions I had raised, a full 2 days before I was aware of that response. In the meantime, I confess I thought that (I think it was) JoF was being very witty.

Break your back and the first thing you do when you get tech within reach is log onto Aweb?! THAT's the eejit part! (I'm aware of the irony... no, it's outright hypocrisy... in my saying that!)

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By carnmores
01st Jan 2020 09:44

LOL but gently. When youre lying down for 3 days sometimes Aweb is a light relief! Must be the drugs!

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By Matrix
01st Jan 2020 10:01

What advice should we be giving to clients about this? Do they treat kindle sales as zero rated or do we wait the outcome of appeals?

Best wishes for your recovery Carnmores. You never know, the drugs may be very helpful during tax return season ;)

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Replying to Matrix:
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By carnmores
01st Jan 2020 11:42

Oh yes, finished fentanyl its tramadol today....

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