The NYT headline misses the point somewhat… Large companies have been 'basing' their sales operations in Luxembourg because it has an extremely low rate of VAT

The NYT headline misses the point somewhat… Large companies have been 'basing' their sales operations in Luxembourg because it has an extremely low rate of VAT of ebooks, digital music etc. Their sales operations have mainly been in name only with most of the work being done in other countries, and revenue moved around via high interest rate loans. The EU have decided to legislate against this and make VAT payable at the rate in the buyers country. Only problem is in legislating to prevent the likes of Apple and Amazon using the Luxembourg VAT loophole they've created hell for lots of small independent sellers who now have to charge VAT whether they needed to or not before, and charge in at multiple rates depending on where the buyer is. Rachel Andrew has some good writeup's on this, in particular http://rachelandrew.co.uk/archives/2014/11/30/how-the-eu-vat-rules-make-eu-startups-and-digital-businesses-uncompetitive-in-a-global-market/ http://rachelandrew.co.uk/archives/2014/11/30/how-the-eu-vat... with more in the archives http://rachelandrew.co.uk/archives/ http://rachelandrew.co.uk/archives/