ECJ decides different rates of VAT can be charged for books supplied in different physical formats where they meet different needs of the consumer
Ryan Bevan 29 September 2015 No comments
In the recent K Oy case (C-219/13) the ECJ considered whether reduced VAT rates for paper books should also be applied to books supplied in other physical formats, such as audiobooks and books published on CDs, CD –ROMs and USBs.
The Court decided that different rates could be justified if the format of the book met different needs for the typical consumer, i.e. whether differences between the formats have a significant influence on the purchasing decision of the average consumer. If, however, the average consumer essentially considers they are purchasing a book, regardless of the format on which it is received, then a selective application of a reduced rate of VAT cannot be justified.
The Court decided that it was for each Member State to determine whether the average consumer regarded the different formats of book as similar.
The judgement does not deal with the VAT liability of e-books delivered digitally which is currently subject to EU infraction proceedings against France and Luxembourg.