France Required to Increase VAT on eBooks

If you live in the European Union, you may not realize that when you buy ebooks, you’re paying a high rate of VAT. In the UK, where I live, there is no VAT on books, as as well as magazines and newspapers. In France, the VAT rate on books is a reduced rate of 5.5%.

For the past three years, France has applied that reduced VAT rate to ebooks, but, as Le Monde reports today, the European Court of Justice has determined that this is illegal, and is requiring France to restore the 20% VAT rate.

This is simply ridiculous. Most countries that have VAT tax books at a lower, or null rate, because of their importance to society. It took years for the French to lower the VAT rate on ebooks, and they should be allowed to keep it there. It’s a shame; it makes ebook prices higher, or margins lower, and will stifle the growth of ebook sales.

In the UK, with 20% VAT on ebooks, this means that a book that costs £6 could cost only £5 if there were no VAT, as there is for printed books. For those who are on a budget, the extra cost of VAT can limit the amount of books they can buy. This also applies to ebooks purchased for school, which add 15% to their cost, which is patently unfair.