VAT policies create barrier to electronic publications

Governments have for some years been gung-ho about the potential of electronic / online technologies both at work and in the home. You may be surprised therefore to hear that UK and European VAT policies are clearly working against the trend for conversion from print to electronic publications. Whereas printed publications throughout the EU are subject to a reduced rate of VAT (zero-rated in the UK), electronic publications in most countries are charged with the highest rate. This means that any library switching from print to electronic will suffer increased costs. The reason for this is apparently that whereas printed works are treated as goods, electronic works are treated as services. Libraries and publishers are now joining forces to lobby for a change in this practice.

http://www.eblida.org/press_releases/pr_25October06.htm