Apple's iTunes and App Store downloads may see a price increase next year when new UK laws take effect.
The Guardian reports that the most recently introduced budget closes a loophole that allowed digital downloads to avoid UK taxes.
The budget document said: "As announced at budget 2013, the government will legislate to change the rules for the taxation of intra-EU business to consumer supplies of telecommunications, broadcasting and e-services. From 1 January 2015 these services will be taxed in the member state in which the consumer is located, ensuring these are taxed fairly and helping to protect revenue."
Digital download retailers such as Apple and Amazon presently avoid the UK's 20% VAT by selling from countries such as Luxembourg where the tax rate is only 3%-15%. Under the new law, downloads to UK customers will be taxed at the higher 20% rate. Apps may be least affected as they are presently taxed at the higher range of 15%.
The change appears to affect all digital downloads including music, apps, and e-books, and will take effect on January 1, 2015.
Top Rated Comments
You wanna make money in a certain country? Pay this country's taxes.
Just ridiculous to pay taxes in Luxembourg or Ireland but sell goods and services in a completely different country?
Since I assume that you have lived in the UK (currently, or at some time) for some considerable period of time (otherwise the post would be...ah...ill considered), could you expand on the comment and explain why the UK is a joke.
No, the US healthcare system is a joke. Things like the VAT support the NHS.
You just get to go bankrupt if you get health problems and don't have health insurance instead.....
You will alway pay any tax as a consumer. It's always you who will pay corporate taxes. I'm sure you will never understand.
Now you get what you wanted in first place. Pay your tax peon.