European Union finance ministers decided on 2nd October to allow lower sales
taxes on e-books and other digital publications and to align them to reduced
levies applied to paper versions of books and magazines.
The deal will allow EU states to apply reduced or even zero VAT rates to
electronic publications.
They are currently taxed at a minimum of 15% because they are treated as
electronic services.
"This proposal is part of our efforts to modernise VAT for the digital
economy, and enables us to keep pace with technological progress," said
Austrian Finance Minister Hartwig Loeger, who chaired the meeting.
The agreement comes after more than two years of talks after a European
Commission proposal.
The European Parliament supported the plan a year ago.
"This is good news for the press and for the culture sector," EU Economic
Commissioner Pierre Moscovici said after the deal was reached.
Very low or zero rates will only be allowed "for member states that
currently apply them to physical publications," the EU Council said in a
note.
The new rules will apply temporarily until a comprehensive reform of the VAT
system in the EU is approved.
The overhaul proposed by the Commission would give EU states more
flexibility in setting VAT rates.
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