Feeds

High Court asked to keep 'cheap DVD' VAT loophole open

Judicial review begins this week

Beginner's guide to SSL certificates

The English High Court will tomorrow begin an investigation to determine whether online retailers should be allowed to avoid paying VAT on CDs, DVDs and Blu-ray Discs.

The judicial review, demanded by the Governments of Jersey and Guernsey, follows Chancellor George Osborne's decision to close the Low Value Consignment Relief (LVCR) loophole on 1 April 2012.

LVCR allowed online retailers shipping low-cost goods from the Channel Islands to avoid VAT. For the past decade, that has allowed the likes of Amazon, Play, Sendit and others to slash the prices of discs.

Disc buyers love it, but small retailers and, crucially, the Treasury hate it. The UK government's finance arm estimates that the loophole, a gap in the tax legislation governing the importation into the EU of goods costing less than £15, costs the Exchequer £110m a year.

Since Jersey and Guernsey aren't part of the EU, retailers have been able to ship low-cost goods there then sell them on to UK punters at VAT-free prices. The government of both territories are keen to maintain LVCR. They say closing the loophole is discriminatory and illegal.

Others argue that LVCR is an anachronism, intended to cover perishable goods sent by post. They argue that the loophole now does nothing but benefit big companies who can afford to ship goods to the Channel Islands and have them shipped out again to the UK.

That, they say, harms small, local retailers across the UK.

The judicial review takes place at the High Court of Justice Queen’s Bench Division Administrative Court concludes on Thursday. It could force the government to maintain LVCR. ®

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
All aboard the Poo Bus! Ding ding, route Number Two departing
Only another three days of pooing and I can have a ride!
Official: European members prefer to fondle Apple iPads
Only 7 of 50 parliamentarians plump for Samsung Galaxy S
Fujitsu CTO: We'll be 3D-printing tech execs in 15 years
Fleshy techie disses network neutrality, helmet-less motorcyclists
Space Commanders rebel as Elite:Dangerous kills offline mode
Frontier cops an epic kicking in its own forums ahead of December revival
Nexus 7 fandroids tell of salty taste after sucking on Google's Lollipop
Web giant looking into why version 5.0 of Android is crippling older slabs
Dragon Age Inquisition: Our chief weapons are...
Bioware's fantasy forces in fine fettle
prev story

Whitepapers

Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Reducing the cost and complexity of web vulnerability management
How using vulnerability assessments to identify exploitable weaknesses and take corrective action can reduce the risk of hackers finding your site and attacking it.
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.