Government flies kite for VAT changes

Wow!!!

The Government will claw back a massive £130 million in VAT. A drop in the ocean when you place this against 4 per cent cut they are making to Corporation Tax. So exactly who is this Government serving?

SHOCK: People pay 500M on CDs

Who would have thunk it. Don't they know that the Internet is awash with torrent sites?

Mine's the one with book "VAT Fraud for fun and profit" in the pocket.

Company Tax

Government, let us keep the VAT-free low prices, and you concentrate your time getting corporation tax from the banks and other companies. A higher return on investment of your time I feel.

Agree - £130m? Chicken feed.

Our government would rather piss about with small tax loopholes they know they can shut than get tough with companies who strong arm the elected government of the land into giving them massive tax breaks.

Vodafone's V2 arm in Luxembourg has saved them a fortune by first purchasing Mannesman and then channeling profits: a long protracted legal battle with HMRC finally terminated when this government came in, took the HMRC lawyers off the case, installed someone who likes big business and settled for £1.2Bn of an estimated alleged £6Bn tax bill.

Also present in this lovely tale is a revolving door staffing system between Vodafone and the government (govt being advised on tax affairs by a former financial director of Vodafone) and George Osborne taking a trip to India to... Publicise vodafone.

£130m on small items sounds like they're trying to appear as if they can do something when in reality they're utterly powerless in the face of globalisation and companies who are now above the law of any nation state through their sheer financial punching power.

Smaller items should stay VAT free

Smaller items should stay VAT free.

Even at their current level of inspection, customs leads to several days delay at busier times of the year - I doubt they can inspect every single thing.

I'm not sure why the 18 pound limit is even being discussed, that looks like a poorly justified cash grab attempt more than anything else if they really mean dropping it entirely. The correct solution to their current 'problem' is to start treating the channel islands as a non-EU place, subject to all the same rules as countries like America and Japan. CDs and so on will still sail through, which is fine given the pitiful amount of tax they'd actually retrieve - just as they do from any country, but larger orders that they still ship tax free from there would be subject to import duties.

I bet Parcelforce are hoping it gets abolished completely - they scam people for massive 'clearance fees' these days, often 5 times more than the actual VAT was on smaller items.

Dont care about the 130m but...

I dont care about the 130mil but what I do think is unfortunate is that its unfair to traditional high street retailers or , if they were any left, your local corner shop.

I've been using Play.com since it was called play247 for many more years than i can remember. So although I have benefitted from VAT discounted internet purchases, I find it sad that its at the cost of loosing dedicated shops. Of course, I'm as selfish as the next man and will continue to buy from somewhere that is cheaper until that legal loophole is closed.

i just wanna say..

I like trucks!

Not Very Green

Course, no one's mentioned the dubious environmental credentials of companies shipping tons of stuff most of the way to France, just to split it into individual packages (indeed often many small packages instead of one larger one to keep under the £18 threshold) and then send it all back again.

But then who cares about the planet when there's wonga to be made!

Reminds of the old maxim about "How to start a small business in the UK..."

... buy a big one, then wait.

The observation about this somehow obstructing independent CD and DVD sellers is bogus.

afaik Tesco joined the party only *after* OTHER independent online CD and DVD sellers (e.g. play.com) took advantage of this loophole to compete with much bigger companies in the UK who had advantages of economies of scale that a newly started, independent retailer couldn't otherwise compete with.

And why close this loophole?

because it's easier than chasing the criminals doing £2bn+ of carousel fraud each year

Idiots

So we get landed with totally-unreasonable customs clearance fees. Even more unreasonable when they've got to be paid to the utterly-incompetent Parcelfarce who cheerfully take the money but don't release the goods. And then you have to chase them up on telephone lines which are charged at a higher rate than normal landline calls.

DHL nowadays seem to deal with me as an account customer so at least I get the goods delivered, followed some time later by an invoice for the duty/VAT and clearance fees.

Meanwhile Hong Kong does a rather nice line in goods which are imported, through the mail, with a customs declaration sticker which denotes what may well be their real value but rather less than the price actually paid ..............

In any case, if this nonsense centres on CDs, then the lesson of what happened with vinyl ought to be a salutary lesson. At best, for me a CD is merely a temporary method of holding music until it is transferred to a server. Make it too difficult or expensive to get my music on CD and like many or most other people, I'll get it some other way.

7 day shop

Oh F*ck! There goes the splendid 7 Day Shop!

(Happy customer, no connection)