Hanne Aho: VAT on e-publications must be cut as soon as possible

UJF president Hanne Aho calls for swift action to cut VAT on e-publications to same level as print as soon as EU Council sets lower rate. 

EU finance ministers meeting in Luxembourg agreed, 2 October, that Member States may, if they wish, calculate VAT on electronic publications to the same level as printed ones. Until now, the VAT for e-publications has been at 24%, while that for printed books and subscription magazines, the rate has been 10%.

EU legislation has so far prevented the application of reduced VAT to digital publications. In the future they may be accorded the same reduced rate as print publications. Further to the political agreement reached by the EU finance ministers, the amendment of the union’s VAT directive will require the final approval of the European Council.

Once the change to the rules on VAT takes effect, each Member State will decide separately whether to use the possibility of calculating VAT on electronic publications. Finland will later decide whether a reduced tax rate and the extent to which electronic publications will be available.

When this happens, each member state will be able to decide for itself whether to use the opportunity to cut VAT on e-publications. Finland will decide on this, and on how much the VAT rate would be cut, later.

The publishing industry and the UJF have long lobbied for lower VAT for e-publications.  In its list of goals for the next government term of office, the union posits a decrease in VAT as a cost-neutral way the government could support the media.

UJF president Hanne Aho says that VAT on e-publications in Finland must be lowered to the same rate as for print publications as soon as possible.

“There needs to be immediate action as soon as the Council of the EU approves the tax reduction. This long-awaited opportunity is now on the way, and is surely of no surprise to anyone.”