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The basic ruling is that e-books are 'electronic services' and not goods, as a paper book would be. Therefor, France and Luxembourg must apply their standard Va

The basic ruling is that e-books are 'electronic services' and not goods, as a paper book would be. Therefor, France and Luxembourg must apply their standard Value-Added Tax (VAT) of 20% and 17% respectively instead of the lower rate used for paper-backed books of 5.5% and 3% respectively. EU law states that reduced rates for specific categories can only apply to goods, not services. The countries as well as companies like Amazon will push to allow the lower VAT to be applied to ebooks.

Cthulhu_ 12y ago
As an extra tidbit of information: Luxembourg was already violating EU rules for having a VAT percentage of less than 5%.
- legulere 12y ago
  Ireland even has a 0% rate on books according to wikipedia. Lower than 5% tax rates seem to be pretty common: http://en.wikipedia.org/wiki/European_Union_value_added_tax#Zero_rate_derogation http://en.wikipedia.org/wiki/European_Union_value_added_tax#...
  - gsnedders 12y ago
    The UK and Ireland have 0% VAT rates which are allowed as they were essentially grandfathered in. They aren't allowed to be expanded, however.
    - andrewpi 12y ago
      Why does the EU restrict members from lowering their VAT rates?
      - gsnedders 12y ago
        To try and avoid overly large price differentials between member states.