Reading tax on e-publications including books, newspapers, magazines or academic journals will have no VAT charge from December 1
- Chancellor has announced that he plans to abolish the so-called ‘reading tax’
- VAT on digital publications including books and newspapers, will be scrapped
- Joked about John McDonnell’s Economics for the Many being ‘a work of fiction’
The Chancellor has today announced that he plans to abolish the so-called ‘reading tax’.
As he delivered his budget, Chancellor Rishi Sunak said VAT on digital publications including books, newspapers, magazines and academic journals is to be abolished from December 1.
Announcing the news, Mr Sunak joked: ‘There will be no VAT on works of fiction, ‘like John McDonnell’s Economics for the Many.’
Chancellor Rishi Sunak said VAT on digital publications including books, newspapers, magazines and academic journals is to be abolished from December 1
The digital offerings of magazines, eBooks, audiobooks, journals and newspaper subscriptions are currently subject to a 20 per cent standard VAT rate while printed publications are zero-rated.
Print publications have never had VAT applied to them because governments have sought to avoid a tax on reading, which would act as a barrier to knowledge.
Sunak told the Commons: ‘Digital publications are subject to VAT. That can’t be right. So today I’m abolishing the Reading Tax.
‘From the 1st December, just in time for Christmas, books, newspapers, magazines or academic journals, however they are read, will have no VAT charge whatsoever.’
Getting in a dig at the opposition, he added: ‘There will be no VAT on historical fiction by Hilary Mantel, manuals or textbooks like Gray’s Anatomy, or indeed works of fantasy like John McDonnell’s Economics for the Many.’
In 2018, the Professional Publishers Association pushed for then-Chancellor Philip Hammond to cut VAT on digital publications in his budget, but he declined to do so.
It subsequently launched an ‘Axe the Reading Tax’ campaign.
Last year, the Publishers’ Association argue that the one in five people who use digital books are being unfairly hit by a 20 per cent VAT charge despite printed versions being exempt.
It said that removing the tax could put up to £210m back into the pockets of UK consumers, half of whom (53 per cent) read paid-for digital publications.
Children’s author Cressida Cowell was among those who called for the ‘illogical and unfair’ tax to be scrapped.
It was scrapped across 18 European nations including France, Germany, Ireland, Italy, Spain, Holland and Sweden in 2018, after new EU legislation allowed member states to reduce or do away with VAT.
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