Print

The government has accelerated changes to apply a permanent zero rate of VAT to supplies of certain electronic publications ('e-publications') from 1 May 2020. Supplies of e-books, e-newspapers, e-magazines and academic e-journals will now be entitled to the same VAT treatment as supplies of their physical counterparts.

Following the outbreak of the coronavirus (COVID-19) pandemic, in an effort to assist ailing newspaper publishing businesses, the government has decided to bring forward the implementation date to 1 May 2020. It was previously scheduled for 1 December 2020. 

Group 3 of Schedule 8 to the Value Added Tax Act 1994 ('Group 3') provides for the zero-rating of printed matter.

Legislation will be introduced by statutory instrument to amend Group 3.

Subject to certain exclusions, the legislative changes will zero rate supplies of e-books, e-booklets, e-brochures, e-pamphlets, e-leaflets, e-newspapers, e-journals and e-periodicals and magazines as well as electronic versions of children’s picture and painting books.

Exclusions are e-publications that are wholly or predominantly devoted to advertising or to audio or video content.
The sale of e-audio books continues to be standard rated in UK law in line with government policy.

Legislation was introduced in the Finance Act 2011 to counter avoidance schemes entered into by some businesses that artificially split supplies so that they could benefit from the zero rate for printed matter. The new legislation will ensure that businesses will not be able to enter into similar schemes when e-publications become zero-rated.

External link

HM Government Zero Rating e-publications