E-publications qualify for VAT zero rate

The measure

The VAT-zero rate for books will be amended to clarify that it applies to books, newspapers, magazines and academic journals that are published electronically, as well as their physical editions.  


Who will be affected?

The changes will be relevant to publishers of e-publications. They will also be relevant to businesses which currently account for UK VAT under the reverse charge on e-publications purchased from overseas. 


When will the measure come into effect?

The government will consult on the new legislation in advance of it being introduced with effect from 1 December 2020.

Our view

Just before Christmas, the Upper Tribunal ruled that the zero rate already applies to online editions of The Times, Sunday Times, and Sun newspapers. Since then, and in response to the Cairncross review into journalism, there has been debate in parliament about the application of the zero rate to online publications. As HMRC are appealing against the Upper Tribunal’s judgment, the confirmation that the zero rate will certainly apply from 1 December is welcome.