UK's digital download price could soar up to 20%

A long standing loophole will now be closed, resulting in 20% increase in VAT on digital download in UK.

Published Tue, Mar 25 2014 12:27 AM CDT   |   Updated Tue, Nov 3 2020 12:17 PM CST

A tax loophole that allowed buyers to purchase digital copies of books, music and apps at a cheaper cost has now been closed. The loophole allowed sales of digital content as low as 99p, since consumers paid very low VAT.

UK's digital download price could soar up to 20% |

Earlier it was pointed out that UK could have financed Olympics Games if it raised VAT of digital downloads between 2008 and 2014. It was also reported in 2012 that UK was losing more than £1.6billion in VAT.

But chancellor George Osborne's latest budget would fix that issue by increasing VAT for digital content, making sellers such as Amazon and Apple to charge 20% VAT for its UK customers. As of now, the digital content is sold with as low as 3% VAT when purchased via Luxemborg. The new bill will be imposed from 1st January, 2015. The new law would make sure that such downloads will be taxed based on the country where the purchase was made.


After being a long time PC enthusiast and a former contributor for many Indian based PC and Tech forums, Roshan now joins TweakTown covering tech news and also any developments from India. Like many enthusiasts, with years of being involved in many Indian tech forums and running his own tech site, he's commonly referred by his forum nickname 'The Sorcerer' by many old and new fellow PC enthusiasts, followed by few companies from time to time. He's also the winner of the TweakTown's Computex 2012 Taipei trip. If any free time is left, Roshan prefers to play FPS games.

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