The UK government move will slash costs of e-books, newspapers and magazines, improving accessibility, seven months ahead of planned abolition
Government plans to scrap VAT on e-books and e-newspapers have been significantly fast-tracked in a boost to readers and publishers during the coronavirus outbreak, the UK Chancellor Rishi Sunak has announced.
The Chancellor said the zero rate of VAT will now apply to all e-publications from tomorrow (1 May 2020), seven months ahead of original plans. This will potentially slash the cost of a £12 e-book by £2 and e-newspapers subscriptions by up to £25 a year.
In support of the print newspaper industry, the government has also announced it will be spending up to £35m on newspaper advertising over the next three months as part of its Covid-19 communications campaign to ensure the whole UK is aware of the latest government guidance and advice.
Sunak said: ‘We want to make it as easy as possible for people across the UK to get hold of the books they want whilst they are staying at home and saving lives. That is why we have fast tracked plans to scrap VAT on all e-publications, which will make it cheaper for publishers to sell their books, magazines and newspapers.’
With the nation staying in their homes during lockdown and schools closed, millions have been relying more on e-publications to pass time, home school and read the news. The Chancellor has opted to bring the zero rating forward to make entertainment more affordable for readers who are rightly staying at home during the coronavirus crisis and are more reliant on e-publications as a result.
On average publishers are reporting an increase of about a third in e-book consumption during the crisis, with some publishers reporting as much as a 50% increase. The £35m extra advertising revenue will be split between local, regional and national print media, and will be a vital boost to the media industry.
The plans to scrap VAT on e-publications were revealed in the Chancellor’s March Budget, but would not originally have come into force until 1 December 2020.