# KDP email: starting January, prices must be VAT-inclusive



## Guest (Dec 2, 2014)

I just received this email: "On January 1, 2015, European Union (EU) tax laws regarding the taxation of digital products (including eBooks) will change: previously, Value Added Tax (VAT) was applied based on the seller's country - as of January 1st, VAT will be applied based on the buyer's country.* As a result, starting on January 1st, KDP authors must set list prices to be inclusive of VAT.* We will also make a one-time adjustment for existing books published through KDP to move from VAT-exclusive list prices to list prices which include VAT. We'll put these changes into effect starting January 1st; you may always change your prices at any time, but you do not need to take any action unless you wish to do so..."

So readers in Europe will end up paying more money for their e-books.


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## D. Zollicoffer (May 14, 2014)

That email confused me. 

I don't even set my UK price, does that mean I can ignore this? It sounded like Amazon will do it automatically if you don't want to be bothered.


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## Guest (Dec 2, 2014)

It seems that they will do it automatically for all existing titles but it's not very clear if they will automatically include VAT for new titles or if we will have to do the math. I certainly hope it won't be the latter


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## The 13th Doctor (May 31, 2012)

I just received the email, too, and I am confused, as well.


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## Vaalingrade (Feb 19, 2013)

What got me is that they're including the VAT in the cost that determines whether or not you earn 70%


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## Elizabeth Ann West (Jul 11, 2011)

This is the email I received, so people who don't get KDP emails yet can see. It has examples.

Hello,

On January 1, 2015, European Union (EU) tax laws regarding the taxation of digital products (including eBooks) will change: previously, Value Added Tax (VAT) was applied based on the seller's country - as of January 1st, VAT will be applied based on the buyer's country. As a result, starting on January 1st, KDP authors must set list prices to be inclusive of VAT. We will also make a one-time adjustment for existing books published through KDP to move from VAT-exclusive list prices to list prices which include VAT. We'll put these changes into effect starting January 1st; you may always change your prices at any time, but you do not need to take any action unless you wish to do so.

One-time Adjustment for Existing KDP Titles

Starting January 1st, for any titles already published in KDP, we will make a one-time adjustment to convert VAT-exclusive list prices provided to us to VAT-inclusive list prices. Subject to minimum and maximum thresholds, we will add the applicable VAT based on the primary country of the marketplace to the VAT-exclusive list price provided. For example, if an author had previously set £5.00 as the VAT-exclusive list price for amazon.co.uk, the new VAT-inclusive list price will be £6.00 because the applicable VAT rate in the UK is 20%. Please note, if an author had set a consistent VAT-exclusive list price for all Euro based Kindle stores, those prices will now be different due to varying VAT rates for the primary country of each Kindle store. For example, if an author had previously provided a €6.00 VAT-exclusive list price for amazon.de, amazon.fr, amazon.es, and amazon.it Kindle stores, the list prices including VAT will be €7.14 (19% VAT), €6.33 (5.5% VAT), €7.26 (21% VAT), and €7.32 (22% VAT) respectively.

Minimum and maximum list prices for the 35% and 70% royalty plans will now also include VAT. For books published before January 1st that would fall outside these new limits after VAT is included, we will adjust the list price to ensure the book remains in the same royalty plan that was previously selected.

Learn more about the new minimum and maximum KDP EU list prices:
https://kdp.amazon.com/help?topicId=ANRML55B0BWBK

Royalties will continue to be calculated based on the list price without VAT. The amount of VAT applied depends on the country where the customer is located. Consider a book with a £6.00 VAT-inclusive price on Amazon.co.uk, for sales to customers in the UK we would apply the UK's 20% VAT rate and the price we use to calculate royalty would be £5.00. The 23% Irish VAT rate will apply to purchases from Ireland, so a customer buying from Ireland would still see £6.00 but, applying the 23% Irish VAT rate, we would calculate royalty based on the VAT-exclusive list price of £4.88.

Learn more about how EU prices affect royalty payments:
https://kdp.amazon.com/help?topicId=A30XCAGX3E5QDC

eBooks in the 35% royalty plan need to meet new minimum list price requirements

You currently have one or more books in the 35% royalty plan that will not meet the new minimum list price requirements. To make sure that your books still meet the minimum list price required for the 35% royalty plan after January 1, we'll adjust the new list price that includes VAT in order to meet the minimum for 35% royalty.
For ebooks less than or equal to 3 megabytes, the new minimum list price requirements are £ 0.99 and € 0.99
For ebooks between 3 and 10 megabytes, the new minimum list price requirements are £ 1.49 and € 1.99
For ebooks equal to or greater than 10 megabytes, the new minimum list price requirements are £ 1.99 and € 2.99

eBooks in the 70% royalty plan need to meet new minimum list price requirements

You currently have one or more books in the 70% royalty plan that will not meet the new minimum list price requirements. To make sure that your books still meet the minimum list price required for the 70% royalty plan after January 1, we'll adjust the new list price that includes VAT to £1.99 and € 2.99 in order to meet the minimum for 70% royalty.

eBooks available for pre-order, scheduled to release after January 1, 2015

For pre-orders placed before January 1, 2015 on books that will release after January 1, 2015, we will pay your royalty as though VAT were still only 3%.

eBooks scheduled for a Kindle Countdown Deal

If you currently have one or more books scheduled to run a Kindle Countdown Deal in the UK marketplace during or after January 1, 2015, your book will still be eligible to finish that promotion, even if the list price does not fit the new requirements of being priced between £1.99 and £15.99, including the VAT.

Setting List Prices for EU Kindle stores

Starting January 1st, to make it easier to set customer friendly list prices without having to calculate VAT for each country, authors will set list prices for EU marketplaces that include VAT. To accommodate this, the KDP pricing grid will be updated to accept VAT-inclusive list prices. Previously, if an author wanted to provide a suggested list price of "£1.99", he would have to set "£1.93" as the VAT-exclusive list price to account for the 3% VAT we would have applied. Now, authors can simply enter "£1.99" and we will deduct the applicable VAT to calculate royalties. In the pricing page, authors will also see their suggested price without VAT displayed for the primary country of the marketplace to help them understand how royalties will be calculated for sales to customers from that primary country.

For those authors who set their EU marketplace prices automatically from their US list price, we will convert the US list price to local currency and that will be the list price that includes VAT. For example, if an author sets the US list price to be $10.00, then we will convert that price to Euros for the German marketplace, and assuming the exchange rate is 0.8, the Amazon.de list price including VAT will be €8.00. For purchases in Germany, we would deduct 19% VAT and calculate royalty on a VAT-exclusive list price of €6.72.

Learn more about setting list prices for EU Kindle stores:
https://kdp.amazon.com/help?topicId=A30464Q6OVH578

As always, if an author lists books with a lower list price on other sites, we may price match those books to the lower prices. We recommend authors review their list prices that include the new VAT on January 1st when these changes go into effect to determine if they want to make any updates.

We think that respecting your VAT-exclusive list prices and keeping books in their chosen royalty plans offers the best experience for authors. If you would like your books to be handled in a different way, contact us with your feedback:
https://kdp.amazon.com/contact-us?topicId=euvat

Best Regards,
Kindle Direct Publishing Team


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## CoraBuhlert (Aug 7, 2011)

Based on what Elizabeth posted (I haven't gotten the mail yet), Amazon continues to be completely incapable of dealing with VAT inclusive prices, which is even more amazing considering that even tiny companies like XinXii can manage it.

No, I don't want my EU prices to be randomly altered by Amazon. If you finally get around to setting VAT inclusive prices than do so without altering my prices. Just take the VAT out of my list price and be done with it. I have 62 books with at least 3 more on the way. I don't want to have to go through all 62 books to undo Amazon's random price changes before they trigger price matches.


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## Avis Black (Jun 12, 2012)

tl;dr.  I'll let Amazon figure it out.

Actually, the part that makes sense is this:

Starting January 1st, to make it easier to set customer friendly list prices without having to calculate VAT for each country, authors will set list prices for EU marketplaces that include VAT.  To accommodate this, the KDP pricing grid will be updated to accept VAT-inclusive list prices. Previously, if an author wanted to provide a suggested list price of "£1.99", he would have to set "£1.93" as the VAT-exclusive list price to account for the 3% VAT we would have applied. Now, authors can simply enter "£1.99" and we will deduct the applicable VAT to calculate royalties.


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## Incognita (Apr 3, 2011)

My head hurts.


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## Guest (Dec 2, 2014)

Avis Black said:


> tl;dr. I'll let Amazon figure it out.
> 
> Actually, the part that makes sense is this:
> 
> Starting January 1st, to make it easier to set customer friendly list prices without having to calculate VAT for each country, authors will set list prices for EU marketplaces that include VAT. To accommodate this, the KDP pricing grid will be updated to accept VAT-inclusive list prices. Previously, if an author wanted to provide a suggested list price of "£1.99", he would have to set "£1.93" as the VAT-exclusive list price to account for the 3% VAT we would have applied. Now, authors can simply enter "£1.99" and we will deduct the applicable VAT to calculate royalties.


Okay, that makes sense. If we want to have "customer friendly" prices, we'll have to set them one by one (always keeping in mind that about 20% of that will go to VAT)


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## Anna Drake (Sep 22, 2014)

Oh dear. I have no idea what they're saying.


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## Tim_A (May 25, 2013)

It all seems pretty straightforward (which is a miracle for anything to do with VAT!) From January 1st, when you set the price for a new book in EU, you set the actual retail price that people see on screen. If you set £1.99 / €1.99, it sells for £1.99/€1.99 (currently if you set £1.99 it sells for £2.04, because VAT gets added by the store)

If you set "convert automatically", you get a VAT-inclusive price (i.e. what people will see on their buy screen)

Your existing books will have the new VAT rates added to their price, and this will be their new EU price. The 75p (ex VAT) base price has been abolished and replaced with 99p (inc VAT). The change in minimum simply reflect the addition of the tax and then rounded to x.99 (by convention, most prices end in .99 anyway). At the base level, this represents an increase in the minimum ex-VAT price (i.e. what royalties are based on) of 8p ($0.12) and 17p ($0.25) for 70%. Amazon have said they'll automatically bump the price of anything that would otherwise fall out of the 70% zone

VAT on eBooks is pretty vile anyway and should be abolished, but that's not Amazon's problem.


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## Tim_A (May 25, 2013)

Of course, you still have to decide if you're going to absorb the extra tax, or put your prices up....

if your book currently SELLS FOR £2.99 (£2.90 seller price in KDP), if you do nothing, it'll go up to £3.48. You'll still get royalties based on 70% of 2.90, but your sales may suffer.
If you set the 1-Jan price to £2.99, it'll sell for £2.99, but your royalties will be based on a seller price of 2.49, so your income may suffer.

Bear in mind that people will be seeing prices going up across the board, so although there's likely to be a short term downturn, people will soon get used to the new prices. The question is, what'll the big 5 do?


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## Anna Drake (Sep 22, 2014)

Tim_A said:


> If you set "convert automatically", you get a VAT-inclusive price (i.e. what people will see on their buy screen)


Somehow I missed that line. Thank you. I feel much better. I was considering just pulling my books out of VAT tax countries rather than trying to figure out a new price per book. Ugh.


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## Gertie Kindle (Nov 6, 2008)

Avis Black said:


> tl;dr. I'll let Amazon figure it out.
> 
> Actually, the part that makes sense is this:
> 
> Starting January 1st, to make it easier to set customer friendly list prices without having to calculate VAT for each country, authors will set list prices for EU marketplaces that include VAT. To accommodate this, the KDP pricing grid will be updated to accept VAT-inclusive list prices. Previously, if an author wanted to provide a suggested list price of "£1.99", he would have to set "£1.93" as the VAT-exclusive list price to account for the 3% VAT we would have applied. Now, authors can simply enter "£1.99" and we will deduct the applicable VAT to calculate royalties.


It was confusing to me, too, until I got to that paragraph. Amazon will adjust my existing titles before 1/1/15, and after that if I choose to let Amazon do the calculations, they will set the VAT inclusive price with a separate listing for the VAT exclusive price on which I will be paid royalties.

The question is how is Kobo (e.g.) going to handle this?


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## Rae Scott Studio (Jan 26, 2014)

Simply put in plain English as I understand it.

VAT used to be based on a SELLERS country of origin now it will be based on the BUYERS..

On January 1st, all ebooks bought in the EU must pay a 20% tax.  
Amazon will for one time only, adjust the price for all existing books to include the VAT automatically. 

AFTER Jan 1st, you must either add in the 20% for VAT manually or the 20% will come out of the price that was automatically converted from your USA pricing. 
Royalty will be based on the price of the item AFTER VAT is deducted. If your after VAT price does not meet the minimum for 70% then you will be automatically paid 35% of the after VAT sale amount.

At least that's how I understand it.


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## Tim_A (May 25, 2013)

Rae Scott Studio said:


> On January 1st, all ebooks bought in the EU must pay a 20% tax.


Not quite. All books bought in the *UK* pay 20%. But books in Ireland are charged 23%, Germany 19%, France 5.5%... every country is different.



> Amazon will for one time only, adjust the price for all existing books to include the VAT automatically.
> 
> AFTER Jan 1st, you must either add in the 20% for VAT manually or the 20% will come out of the price that was automatically converted from your USA pricing.
> Royalty will be based on the price of the item AFTER VAT is deducted. If your after VAT price does not meet the minimum for 70% then you will be automatically paid 35% of the after VAT sale amount.
> ...


As part of the one-time adjustment, Amazon will make sure you stay in the 70% price band; they do explicitly say that.
After Jan 1st, you will ONLY set the inclusive price, i.e. the price the customer sees in store (currently the in-store price is higher than the price you set). The minimum price for 70% is now expressed as an inclusive price. It IS slightly higher than the old price, but only by about $0.25.

If you let Amazon set the EU prices before, you can still do that, but be aware that the new prices include much more tax. (and no, you do NOT want Amazon to pay you the tax amount and you file it yourself!)


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## SB James (May 21, 2014)

Tim_A said:


> Not quite. All books bought in the *UK* pay 20%. But books in Ireland are charged 23%, Germany 19%, France 5.5%... every country is different.
> 
> As part of the one-time adjustment, Amazon will make sure you stay in the 70% price band; they do explicitly say that.
> After Jan 1st, you will ONLY set the inclusive price, i.e. the price the customer sees in store (currently the in-store price is higher than the price you set). The minimum price for 70% is now expressed as an inclusive price. It IS slightly higher than the old price, but only by about $0.25.
> ...


No, you are quite right, I do not want to have to fiddle with sales taxes from outside the US. It would be a nightmare if we had to add sales taxes to our products based on each state as well. 
I was hoping there'd be a discussion on here about that email, I was getting very confused. But as long as I know how to adjust each country's tax, I can probably handle that for all my future books.
I was also wondering about the other sellers in regards to the new VAT pricing. I haven't gotten anything from Draft 2 Digital about it.


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## Quiss (Aug 21, 2012)

Europeans, like us Canadians (who aren't mentioned yet) are used to the additional taxes.

What bugs me is this:



> As always, if an author lists books with a lower list price on other sites, we may price match those books to the lower prices. We recommend authors review their list prices that include the new VAT on January 1st when these changes go into effect to determine if they want to make any updates.


That means our price INCLUDING vat has to be lower than prices at other sites that (still) don't.


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## Monique (Jul 31, 2010)

Well, that's an enormous pita, Quiss.


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## Elizabeth Ann West (Jul 11, 2011)

My question is how will this affect permafree books? Years ago, before Amazon stores in multiple countries, I remember that readers in some countries still had to pay taxes on books that were free, based on the list price.


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## SB James (May 21, 2014)

Elizabeth Ann West said:


> My question is how will this affect permafree books? Years ago, before Amazon stores in multiple countries, I remember that readers in some countries still had to pay taxes on books that were free, based on the list price.


It is going to affect my permafree, since it's only free in the UK, as far as I know, it's not price matched in any of the other EU countries on Amazon. My email made a mention of my 99 cent book (that's price matched to free) and that I won't meet the minimum price with the VAT if I leave it at that price. Although I thought Amazon was supposed to adjust the price for me since I published that book in 2014.
And again, what about the other sellers?
What fun!


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## CJArcher (Jan 22, 2011)

Quiss said:


> Europeans, like us Canadians (who aren't mentioned yet) are used to the additional taxes.
> 
> What bugs me is this:
> 
> That means our price INCLUDING vat has to be lower than prices at other sites that (still) don't.


This is what's worrying me too. As Monique says, huge PITA for those of us with many book on many platforms.


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## Vaalingrade (Feb 19, 2013)

Thy better not send any nastygrams for price-matching to their incompetent VAT handling. >_<


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## Quiss (Aug 21, 2012)

So does this mean if a book is priced less at Kobo for ie. France they'll price match the Zon US list price, or the Zon French list price?
This makes no kind of sense.


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## Quiss (Aug 21, 2012)

Quiss said:


> So does this mean if a book is priced less at Kobo for ie. France they'll price match the Zon US list price, or the Zon French list price?
> This makes no kind of sense.


Wait a minute... I can't even set prices for individual countries if I publish to iTunes and B&N via D2D. And Kobo has only limited listings, so I couldn't set Ireland separately if I wanted to.
Google Play allows it but it's a major pain to set individual countries.


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## KelliWolfe (Oct 14, 2014)

Tim_A said:


> Not quite. All books bought in the *UK* pay 20%. But books in Ireland are charged 23%, Germany 19%, France 5.5%... every country is different.


This is the part that makes it almost unworkable when you've got 50+ titles out. And then you've got to worry about things like getting local currency conversions right to fix up the Google discounted prices to match what you've got set on Amazon for all of those, and then there are the stores that the distributors like Kobo push to in France and Germany that you have no way of individually controlling the prices for anyway.

It might be worth doing for the UK, but for as little as I make in the other markets it's not a good use of my time. If A gets pissy about price matches in Germany and the other EU countries I'll just uncheck the distribution rights for them.


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## Quiss (Aug 21, 2012)

KelliWolfe said:


> This is the part that makes it almost unworkable when you've got 50+ titles out. And then you've got to worry about things like getting local currency conversions right to fix up the Google discounted prices to match what you've got set on Amazon for all of those, and then there are the stores that the distributors like Kobo push to in France and Germany that you have no way of individually controlling the prices for anyway.
> 
> It might be worth doing for the UK, but for as little as I make in the other markets it's not a good use of my time. *If A gets p*ss y about price matches in Germany and the other EU countries I'll just uncheck the distribution rights for them.*


This.
Until the others also start charging VAT, it might just be easier to pull some international options from Amazon than to fiddle with all the other vendors. Other than the UK, I don't really see a lot of sales there, whereas things are picking up internationally at Google and even Kobo.

So I don't want to be raising my prices there just because Amazon wants me to. 
I totally get that Amazon shouldn't pay "royalties" on taxes that they have to pay out, but the price matching should not be taking the taxes into account, either.


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## Guest (Dec 2, 2014)

Aren't the other sites (Kobo, iTunes, etc) already VAT inclusive? So really, you just have to make sure that your list price on Amazon matches the list price everywhere else? (for iTunes, I think they just round up to the nearest 99 ending anyway for the local currency, so it's not nearly as much of a PITA as google play) Please correct me if I'm wrong.

Making the prices VAT inclusive is a massive improvement on the previous regime--something that Amazon should have done from the very beginning. As for the ridiculous tax hike, well, the EU is on the verge of collapse, so no surprise there. The real question is what happens when the euro is gone.


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## EC (Aug 20, 2013)

All Zon has to do is split their auto pricing into EU and non-EU countries.  That way we can set auto in the US and the rest of the world, and set the base price in the UK, and let Zon calculate the VAT for the rest of the EU countries based upon that figure. 

It can't be hard for a big company like Zon to do that.


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## CoraBuhlert (Aug 7, 2011)

Quiss said:


> What bugs me is this:
> 
> That means our price INCLUDING vat has to be lower than prices at other sites that (still) don't.


The other sites already offer VAT inclusive prices as far as I know. It's only Amazon who couldn't figure out how to do it.


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## Vaalingrade (Feb 19, 2013)

Okay. So I have a book that's on sale in the US for $8.99

With VAT, that's going to be over 9.99. Are they going to screw me out of my 70% royalty for that?


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## 75845 (Jan 1, 1970)

Joe Vasicek said:


> Aren't the other sites (Kobo, iTunes, etc) already VAT inclusive?
> 
> So really, you just have to make sure that your list price on Amazon matches the list price everywhere else? (for iTunes, I think they just round up to the nearest 99 ending anyway for the local currency, so it's not nearly as much of a PITA as google play) Please correct me if I'm wrong.
> 
> Making the prices VAT inclusive is a massive improvement on the previous regime--something that Amazon should have done from the very beginning. As for the ridiculous tax hike, well, the EU is on the verge of collapse, so no surprise there. The real question is what happens when the euro is gone.


All the other main had tax inclusive prices on the publisher side page, but every time I called for Amazon to do likewise I was flamed on kboards. So I punched the air when I read the email this morning - Amazon caved in to the inevitable at last. So there are no price-matching difficulties from Kobo, iTunes, or Nook as they all enforce tax-inclusive EU pricing and Google Play are removing the ability to set tax-exclusive pricing in the EU. Where you need to worry is Smashwords, which has one US-based store, priced in dollars, tax-exclusive. Hopefully Smashwords Store is too small for Amazon to be worried about.

You last two sentences are however all manner of wrong. This is not a ridiculous tax hike, 20% is what we pay in the UK and it is only because of a temporary loophole that we got away with just 3% going to Luxembourg (where Kobo and Nook are also based). The EU is not going anywhere (although it is going after Amazon and Apple for sweetheart tax deals) nor is the Euro about to disappear.

http://www.futurecurrencyforecast.com/euro-us-dollar-eurusd-exchange-rate-forecast-hold-gain-ahead-us-manufacturing/32609


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## 75845 (Jan 1, 1970)

Vaalingrade said:


> Okay. So I have a book that's on sale in the US for $8.99
> 
> With VAT, that's going to be over 9.99. Are they going to screw me out of my 70% royalty for that?


No they will price match to what they currently price match, keep you in 30% retail fee rate, but deduct the relevant VAT, so you earn less, but at 70%.


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## ThomasDiehl (Aug 23, 2014)

Finally, this makes things so much easier about the new tax legislation. Yeah, it's a pain to go through pricing for each book day one in each currency, but still way better than trying to work that out with A's current system. At least now selling books in Austria won't be an illegal activity anymore due to conflicting laws (long story involving mandatory price matching and the new VAT law).


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## Tim_A (May 25, 2013)

Vaalingrade said:


> Okay. So I have a book that's on sale in the US for $8.99
> 
> With VAT, that's going to be over 9.99. Are they going to screw me out of my 70% royalty for that?


No. The email clearly states that if the price adjustment would push you out of the royalty band, they'll raise/lower the price sufficient to keep you in it. If you want the change the price after their adjustment, that's up to you.


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## Tim_A (May 25, 2013)

Quiss said:


> Until the others also start charging VAT, it might just be easier to pull some international options from Amazon than to fiddle with all the other vendors. Other than the UK, I don't really see a lot of sales there, whereas things are picking up internationally at Google and even Kobo.
> 
> So I don't want to be raising my prices there just because Amazon wants me to.
> I totally get that Amazon shouldn't pay "royalties" on taxes that they have to pay out, but the price matching should not be taking the taxes into account, either.


EVERYONE will raise VAT on January 1. It's EU law. So it will still be a level playing field.

Remember, Amazon is customer-focused. In the EU, the customer always sees the price including VAT, so that's is what they must match against. If Kobo etc is still making you set ex-VAT prices after Jan 1, it's them that are adding extra hassle in the price setting mix, not Amazon. But from what others appear to be saying, their prices are already inclusive (I know for sure that the price you set on iTunes includes VAT; it always has), and it's Amazon that's playing catch up.


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## Mark E. Cooper (May 29, 2011)

CoraBuhlert said:


> Based on what Elizabeth posted (I haven't gotten the mail yet), Amazon continues to be completely incapable of dealing with VAT inclusive prices, which is even more amazing considering that even tiny companies like XinXii can manage it.
> 
> No, I don't want my EU prices to be randomly altered by Amazon. If you finally get around to setting VAT inclusive prices than do so without altering my prices. Just take the VAT out of my list price and be done with it. I have 62 books with at least 3 more on the way. I don't want to have to go through all 62 books to undo Amazon's random price changes before they trigger price matches.


They are taking vat out of the retail price after January 1st. At the moment, they don't do that. They currently add vat to your list price, and that's why I input 2.90 at KDP to show 2.99 on sales pages in the UK.

After Jan 1st, they are going to take the vat from the list price, so if they don't increase prices in the KDP dash, authors will get 17% less money for each sale (ebooks currently are 3%vat and will change to 20%) After they have changed prices, I will look at the numbers and get some nice .99 ending again. I really do find the silly .99 price endings work. So basically, my prices are going up around 20% come the new year. I can't afford a 17% drop across EU.


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## CraigInOregon (Aug 6, 2010)

Tim_A said:


> VAT on eBooks is pretty vile anyway and should be abolished, but that's not Amazon's problem.


Agreed.

What worries me is this:

Is this all just a set-up for Euro-Powers to come down hard on US (and other non-Euro country) authors, making them liable to file foreign tax returns?

Yikes. Almost as bad as BEING a Euro author and having to file a US return just to get your US withholding back...


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## 75845 (Jan 1, 1970)

CraigInOregon said:


> Is this all just a set-up for Euro-Powers to come down hard on US (and other non-Euro country) authors, making them liable to file foreign tax returns?


No it's aimed at Amazon (and others, but principally them) making millions in one country (principally UK) and paying a reduced VAT rate in another (Luxembourg). VAT=sales tax. It has nothing to do with tax returns and tax treaties on royalties work for both countries' tax residents. The Luxembourg government is also in trouble over its sweetheart deals with Amazon.


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## D-C (Jan 13, 2014)

It's doubly annoying because print books in the UK aren't subject to VAT. Ebooks are. Why!? Anyway. I digress. 
Buyers will be paying more (previously amazon got away with charging very little VAT because it was based in Lux - that's no longer an option thanks to EU laws). Amazon will skim the VAT off for us. So the buyers lose out. We get our cut from net. Amazon gets their cut from net.


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## Vaalingrade (Feb 19, 2013)

But those buyers get things like infrastructure, which, knowing what I know about how many bridges around here are waiting for a stiff breeze to kerplode because not killing dozens in a collapse is 'pork*', is a pretty good trade.

*pork - money not spent in the states the committee members hale from.


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## Quiss (Aug 21, 2012)




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## Lynn McNamee (Jan 8, 2009)

I'm guessing more UK readers will join KU to save money on books.


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## Fredster (Apr 11, 2011)

So if a lazy person wanted to just stop selling books outside the US to avoid the hassle, is the only way to do it to claim he only has rights to sell in the US? I'm not seeing a way to actually pick and choose the countries in which to sell, but it looks like I could only claim rights in the US to achieve what I want.


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## RBK (Nov 28, 2014)

Speaking as a UK reader, everything up to about £3.49 is all one and the same. In other words, I wouldn't think more about buying a £3.49 book over, say, a £2.99 one. I think a lot of UK readers are similar - anything below £5 is still considered a sweet spot over here. £4-5 is probably an upper limit.

As a writer who sells my UK novels at £2.99 currently, I don't think a price rise to £3.49 will affect much, based on these price thoughts. So I'll likely price mine at £3.49 going forward. See how it goes.

It's frustrating, but I don't think it's going to affect our income much. Not on Zon anyway. I feel for small businesses who are affected by these changes, though. Pretty brutal to direct sellers overseas.


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## Mark E. Cooper (May 29, 2011)

RKC said:


> Speaking as a UK reader, everything up to about £3.49 is all one and the same. In other words, I wouldn't think more about buying a £3.49 book over, say, a £2.99 one. I think a lot of UK readers are similar - anything below £5 is still considered a sweet spot over here. £4-5 is probably an upper limit.
> 
> As a writer who sells my UK novels at £2.99 currently, I don't think a price rise to £3.49 will affect much, based on these price thoughts. So I'll likely price mine at £3.49 going forward. See how it goes.
> 
> It's frustrating, but I don't think it's going to affect our income much. Not on Zon anyway. I feel for small businesses who are affected by these changes, though. Pretty brutal to direct sellers overseas.


Agreed. Anything under a fiver would be fine. Over it? NO WAY! That's a problem for my boxset, because i don't want to lose the extra 17%. I currently have £2.99 on all individual titles, and £4.99 on my 3 book boxsets (Bargain!, Go get them  ) So £3.49 and £5.99 would be my prices, but I'll be watching sales of the box sets to see if there is a drop in downloads. Not sure what to do with France etc. It might be better to just keep the numbers the same as I do currently despite the currency fluctuations and the difference in vat. Some are higher than UK, but most are lower. Treating them all the same seems the thing to do though.


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## RBK (Nov 28, 2014)

Mark E. Cooper said:


> Agreed. Anything under a fiver would be fine. Over it? NO WAY! That's a problem for my boxset, because i don't want to lose the extra 17%. I currently have £2.99 on all individual titles, and £4.99 on my 3 book boxsets (Bargain!, Go get them  ) So £3.49 and £5.99 would be my prices, but I'll be watching sales of the box sets to see if there is a drop in downloads. Not sure what to do with France etc. It might be better to just keep the numbers the same as I do currently despite the currency fluctuations and the difference in vat. Some are higher than UK, but most are lower. Treating them all the same seems the thing to do though.


I agree completely! The pricing for boxsets is trickier, you're right there. I think I'll up the price of my post apocalyptic to £5.99 too. It'll be an interesting experiment, hopefully of the positive kind. 

As for the Non UK channels, yeah. Something for a rainy day I think...


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## Guest (Dec 2, 2014)

Mercia McMahon said:


> The EU is not going anywhere


I do not think that the EU is going to survive the current economic crisis going on right now in Europe. This is not because I want to see it collapse. When you look at the data, though, it's hard to believe that the union will last much longer.

The southern countries are experiencing one of the worst economic downturns of the modern era, worse than the US depression. The last linchpin holding it all together is Germany, but forty percent of their economy is exports, and if the markets dry up, everything goes to hell. Even if they don't, you have a major regional power on your eastern flank (Russia) that is becoming increasingly aggressive, largely because it views Western meddling in Ukraine as an existential threat. With nationalist groups rising as austerity takes its toll, a very grim history is repeating itself.

I fully expect to see a major global war within my lifetime. Every global conflict in history thus far has begun with Europe. The biggest question in my mind is whether the EU will collapse in five years or five months.


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## Nic (Nov 17, 2013)

Joe Vasicek said:


> I do not think that the EU is going to survive the current economic crisis going on right now in Europe. This is not because I want to see it collapse. When you look at the data, though, it's hard to believe that the union will last much longer.
> 
> The southern countries are experiencing one of the worst economic downturns of the modern era, worse than the US depression. The last linchpin holding it all together is Germany, but forty percent of their economy is exports, and if the markets dry up, everything goes to hell. Even if they don't, you have a major regional power on your eastern flank (Russia) that is becoming increasingly aggressive, largely because it views Western meddling in Ukraine as an existential threat. With nationalist groups rising as austerity takes its toll, a very grim history is repeating itself.
> 
> I fully expect to see a major global war within my lifetime. Every global conflict in history thus far has begun with Europe. The biggest question in my mind is whether the EU will collapse in five years or five months.


+1

That's why I had hoped Scotland would vote for independence. It would have woken up the middle class.


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## hardnutt (Nov 19, 2010)

I feel a migraine coming on. And I don't even suffer from migraines.


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## meh (Apr 18, 2013)

Wow, I'm learning a lot just reading this thread about the economic situation in Europe. Funny how the U.S. news never even mentions it. 

What I took the email to mean was that if I self price things, they'll just take the VAT out of it. But that means I'll have to price it above the threshold for 70% to make sure it's 70%. I already do this for all my books, so I don't think I'll need to do much. I'll just be happier now that my books in the UK are at 1.99 rather than 2.04. I hate that.


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## SB James (May 21, 2014)

Well, I guess I'd better get started figuring out pricing for future books. I most likely will not be releasing anything new until next year, so maybe I can see what my prices will look like in the EU countries when Amazon adds the VAT to the price before I price the next book.
As for Google Play, I have no idea what I'm doing in that dashboard as is :/ so I really didn't want to have to start setting prices for each country if I could possibly avoid it.


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## anotherpage (Apr 4, 2012)

garam81 said:


> I just received the email, too, and I am confused, as well.


LoL Join the club. Us writers we get confused about a lot of things unless it's to do with gaining more money, or more success


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## anotherpage (Apr 4, 2012)

CoraBuhlert said:


> Based on what Elizabeth posted (I haven't gotten the mail yet), Amazon continues to be completely incapable of dealing with VAT inclusive prices, which is even more amazing considering that even tiny companies like XinXii can manage it.
> 
> No, I don't want my EU prices to be randomly altered by Amazon. If you finally get around to setting VAT inclusive prices than do so without altering my prices. Just take the VAT out of my list price and be done with it. I have 62 books with at least 3 more on the way. I don't want to have to go through all 62 books to undo Amazon's random price changes before they trigger price matches.


There is a lot of things Amazon is incapable of doing, including tallying up column inside KDP lol


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## anotherpage (Apr 4, 2012)

metwo said:


> Oh dear. I have no idea what they're saying.


ROFL LOLLLLLllllllll It's double dutch to me too, and I have read it 10 times. It makes less sense than 50 shades of grey.


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## 75814 (Mar 12, 2014)

Joe Vasicek said:


> I do not think that the EU is going to survive the current economic crisis going on right now in Europe. This is not because I want to see it collapse. When you look at the data, though, it's hard to believe that the union will last much longer.
> 
> The southern countries are experiencing one of the worst economic downturns of the modern era, worse than the US depression. The last linchpin holding it all together is Germany, but forty percent of their economy is exports, and if the markets dry up, everything goes to hell. Even if they don't, you have a major regional power on your eastern flank (Russia) that is becoming increasingly aggressive, largely because it views Western meddling in Ukraine as an existential threat. With nationalist groups rising as austerity takes its toll, a very grim history is repeating itself.
> 
> I fully expect to see a major global war within my lifetime. Every global conflict in history thus far has begun with Europe. The biggest question in my mind is whether the EU will collapse in five years or five months.


The rise of the nationalist groups around the globe is very troubling. We're also seeing that here in Japan and now we've got a PM who's a historical revisionist who is more interested in p*ss ing matches with China than economic recovery.


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## CoraBuhlert (Aug 7, 2011)

The EU is not going anywhere, Joe, anymore than the US is. Neither is the Euro. And the economic situation is not nearly as bad as certain US media outlets make it out to be, especially as the EU is not a monolith. Some countries are having problems, some like my own are doing very well indeed (and Russia isn't a big impact except in certain industries, since most exports go elsewhere anyway) and most are somewhere in the middle.

Finally, there are plenty of EU citizens on this board. It's not okay to insult us over a tax issue.

Back to the actual issue at hand, I disagree with charging VAT according to the buyers' country for inner EU sales, because it disproprotionately inconveniences small businesses. I also disagree with charging a reduced VAT rate for print books and the higher regular rate for e-books, because e-books are books, not software.

However, I welcome the fact that Amazon is finally moving to VAT inclusive prices, which are standard everywhere except in the US and Canada, where the price on the sticker is never the price you pay. However, I don't welcome the way they will do this, namely by messing with the prices we set and/or forcing us to raise our prices (or lower them for some boxsets) to comply with their 70% bracket. Every other vendor, including B&N who really aren't the most progressive of stores, already offer VAT inclusive pricing without kicking people out of their high royalty brackets, so why can't Amazon manage this?

BTW, for those who can read German, here is a pretty good explanation of the tax issue at a German self-publishing site: http://www.literaturcafe.de/self-publishing-amazon-aendert-preise-zum-1-januar-2015-sie-beachten-muessen/


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## Guest (Dec 3, 2014)

CoraBuhlert said:


> The EU is not going anywhere, Joe, anymore than the US is. Neither is the Euro. And the economic situation is not nearly as bad as certain US media outlets make it out to be, especially as the EU is not a monolith. Some countries are having problems, some like my own are doing very well indeed (and Russia isn't a big impact except in certain industries, since most exports go elsewhere anyway) and most are somewhere in the middle.
> 
> Finally, there are plenty of EU citizens on this board. It's not okay to insult us over a tax issue.


I don't mean to insult anyone by my comments on the VAT. Perhaps it's an American thing, but I tend to think that no one enjoys paying taxes, and would prefer to avoid them wherever legally possible.

For the EU to have the same staying power as the US, it would have to become the United States of Europe--not an easy thing. Over here, we fought a bloody civil war to unite this country into one nation. More Americans died in the US Civil War than in all other wars (including WWI and WWII) combined, and the ghosts of that conflict still haunt us today, as the race riots in Ferguson make clear. What sort of unifying conflicts have the Europeans fought to make the EU possible? None, because it's a union based on shared prosperity, not shared hardships. When the era of prosperity ends, how can the union stand?

Sorry, but I'm the kind of guy who really enjoys a good geopolitical debate. From a realpolitik perspective, I do not see how the EU or the euro can last. I wonder how that will affect all of us, if/when the euro collapses.


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## Nic (Nov 17, 2013)

CoraBuhlert said:


> Finally, there are plenty of EU citizens on this board. It's not okay to insult us over a tax issue.


I'm an EU citizen and it wasn't an insult to me. I consider it a rather realistic scenario.


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## 75845 (Jan 1, 1970)

Joe Vasicek said:


> More Americans died in the US Civil War than in all other wars (including WWI and *WWII*) combined, and the ghosts of that conflict still haunt us today, as the race riots in Ferguson make clear. What sort of unifying conflicts have the Europeans fought to make the EU possible?


You provided your own answer, Joe, the EU exists to prevent another WWII. It will continue to exist because no-one wants another WWII. PS, this is way too political for this board, and just because Nic agrees with your politics and is not offended does not mean that your inappropriate comments are not offending other EU board members.


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## ThomasDiehl (Aug 23, 2014)

judygoodwin said:


> What I took the email to mean was that if I self price things, they'll just take the VAT out of it. But that means I'll have to price it above the threshold for 70% to make sure it's 70%. I already do this for all my books, so I don't think I'll need to do much. I'll just be happier now that my books in the UK are at 1.99 rather than 2.04. I hate that.


No, from January 1st on, the threshold will be based on the tax-inclusive price and raised in the process (e.g. minimum goes from €2.80 to € 2.99). You do not have to set a price further above threshold to compensate for taxes.


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## DaniO (Oct 22, 2012)

I really don't understand why paper books qualify for 0% VAT yet ebooks = 20% in the UK.

I was so angry when I got the email. Not at Amazon but the UK government and the EU. We all knew it was coming but I'd hoped there would be some last minute change. If France is contesting the increase in VAT, why don't we? The extra money the EU wanted from the UK by December created some strong feelings over here. UKIP are increasing in power, and it isn't really surprising. These new VAT rules are in place to catch the large companies avoiding tax, but in reality it is going to be the small companies and self-employed who really suffer.

I would love to have received an email from Amazon suggesting members of KDP and readers send protest emails to the relevant people. They did that with their disagreement with Hachette, so why not do it again? This increase in VAT will cost their customers even more.


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## Ros_Jackson (Jan 11, 2014)

Carrie_Cox said:


> I really don't understand why paper books qualify for 0% VAT yet ebooks = 20% in the UK.
> 
> I was so angry when I got the email. Not at Amazon but the UK government and the EU. We all knew it was coming but I'd hoped there would be some last minute change. If France is contesting the increase in VAT, why don't we? The extra money the EU wanted from the UK by December created some strong feelings over here. UKIP are increasing in power, and it isn't really surprising. These new VAT rules are in place to catch the large companies avoiding tax, but in reality it is going to be the small companies and self-employed who really suffer.
> 
> I would love to have received an email from Amazon suggesting members of KDP and readers send protest emails to the relevant people. They did that with their disagreement with Hachette, so why not do it again? This increase in VAT will cost their customers even more.


There's a petition about the change, but it's aimed at the VAT exemption threshold which will harm a lot of micro-businesses, rather than the imposition of the tax itself: 
https://www.change.org/p/vince-cable-mp-uphold-the-vat-exemption-threshold-for-businesses-supplying-digital-products

So although the tax changes will hit Amazon and similar large companies, there will be a change in the way VAT is handled that will inadvertently concentrate more power in their hands as well. The tl;dr version is, micro-businesses that used to fly under the VAT-registration threshold of £81,000 in the UK (it's different in other EU countries) will now have to file returns and keep records if they make even one sale of digital services to anyone in the EU. This will apply to you if you sell ebooks via your own website.

It's very confusing.


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## Betsy the Quilter (Oct 27, 2008)

Stepping in to remind people that political discussions are not allowed on KBoards.  Some of the topics here have gotten a bit beyond the scope of the OP.

Betsy
KB Mod


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## 75845 (Jan 1, 1970)

Ros_Jackson said:


> The tl;dr version is, micro-businesses that used to fly under the VAT-registration threshold of £81,000 in the UK (it's different in other EU countries) will now have to file returns and keep records if they make even one sale of digital services to anyone in the EU. This will apply to you if you sell ebooks via your own website.


That is scaremongering by those who do not go to the tax website and look up the details. VATMOSS is a system that each EU state operates to do the donkey work for you and avoid needing to register in each state for VAT. VATMOSS is voluntary and once joined can be left with 15 days notice (and then cannot be rejoined for two quarters). To sign up for a VATMOSS you must be VAT registered in your home state and that is where the scaremongerers have got confused. If you make one sale in Ireland and you are based in the UK and your turnover is less that the registration thresholds in both countries then you do not need to register for VAT in either country as the VAT threshold still exists in the UK and Ireland's has a similar sized one for digital sales that do not involve a physical product. If you make a sale to a country without a VAT registration threshold you would need to register in that state, but that does not force you to enter VATMOSS. VATMOSS is a convenience for those who need to register anyway, or have business reasons to register (i.e., to reclaim VAT on supplies). Note that if you sell print books from your website that many EU states (including Ireland) have a much lower registration threshold of about 37500 Euros turnover. Although print books are often zero rated, zero rated (as opposed to exempt) goods are usually included in the turnover.

If you sell mostly in English it is unlikely that VATMOSS is worthwhile if it forces you into an unwanted VAT registration.

https://www.gov.uk/register-and-use-the-vat-mini-one-stop-shop


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## Nic (Nov 17, 2013)

Mercia McMahon said:


> That is scaremongering by those who do not go to the tax website and look up the details. VATMOSS is a system that each EU state operates to do the donkey work for you and avoid needing to register in each state for VAT. VATMOSS is voluntary and once joined can be left with 15 days notice (and then cannot be rejoined for two quarters). To sign up for a VATMOSS you must be VAT registered in your home state and that is where the scaremongerers have got confused. If you make one sale in Ireland and you are based in the UK and your turnover is less that the registration thresholds in both countries then you do not need to register for VAT in either country as the VAT threshold still exists in the UK and Ireland's has a similar sized one for digital sales that do not involve a physical product. If you make a sale to a country without a VAT registration threshold you would need to register in that state, but that does not force you to enter VATMOSS. VATMOSS is a convenience for those who need to register anyway, or have business reasons to register (i.e., to reclaim VAT on supplies). Note that if you sell print books from your website that many EU states (including Ireland) have a much lower registration threshold of about 37500 Euros turnover. Although print books are often zero rated, zero rated (as opposed to exempt) goods are usually included in the turnover.
> 
> If you sell mostly in English it is unlikely that VATMOSS is worthwhile if it forces you into an unwanted VAT registration.
> 
> https://www.gov.uk/register-and-use-the-vat-mini-one-stop-shop


As you are so know-all about this, pray, do you have a list of the states where a British seller is under VAT-exemption?

Because the problem is that micro-businesses (by the way not just in England, that's the case for all countries which give a threshold) will lose their £81,000 threshold either if they sell to other EU countries *or* if they register for VATMOSS. The only way to keep it is to sell exclusively within their own country and outside the EU. If you don't keep it, you have to file for VAT from the first penny you earn. I've had this both from my accountant and Inland Revenue Office.


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## 75845 (Jan 1, 1970)

According to a VATlive article released yesterday HMRC are allowing UK based businesses to register for VAT and VATMOSS but only charge VAT on cross-border EU trade, while not charging VAT on internal UK sales. http://www.vatlive.com/european-news/uk-victory-2015-electronic-services-vat-moss-registrations/

Note that non-UK based businesses based in other EU countries have not had a VAT threshold in the UK since 2012 unless exclusively selling zero-rated goods (e.g., print books) and non-EU based businesses have been charging VAT based on the customer's address since 2003.

For those avoiding VATMOSS note that Malta are reducing the VAT registration limit to zero. http://www.vatlive.com/european-news/malta-reduces-vat-registration-threshold-nil-2015/. Better news for Maltese consumers is that they are introducing a special eBook VAT rate at 5%. http://www.vatlive.com/european-news/malta-reduces-vat-e-books-18-5-2015/


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## DaniO (Oct 22, 2012)

Sorry, Betsy! I think my post was probably too political.

Thanks for the link to the petition, Ros. 

The idea of 20% VAT on ebooks in the UK is ridiculous. I really wish Amazon had tried to mobilize its readers and encourage them to protest via email or petition to the relevant people like they did with Hachette.


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## Ancient Lawyer (Jul 1, 2013)

Mercia McMahon said:


> That is scaremongering by those who do not go to the tax website and look up the details. VATMOSS is a system that each EU state operates to do the donkey work for you and avoid needing to register in each state for VAT. VATMOSS is voluntary and once joined can be left with 15 days notice (and then cannot be rejoined for two quarters). To sign up for a VATMOSS you must be VAT registered in your home state and that is where the scaremongerers have got confused. If you make one sale in Ireland and you are based in the UK and your turnover is less that the registration thresholds in both countries then you do not need to register for VAT in either country as the VAT threshold still exists in the UK and Ireland's has a similar sized one for digital sales that do not involve a physical product. If you make a sale to a country without a VAT registration threshold you would need to register in that state, but that does not force you to enter VATMOSS. VATMOSS is a convenience for those who need to register anyway, or have business reasons to register (i.e., to reclaim VAT on supplies). Note that if you sell print books from your website that many EU states (including Ireland) have a much lower registration threshold of about 37500 Euros turnover. Although print books are often zero rated, zero rated (as opposed to exempt) goods are usually included in the turnover.
> 
> If you sell mostly in English it is unlikely that VATMOSS is worthwhile if it forces you into an unwanted VAT registration.
> 
> https://www.gov.uk/register-and-use-the-vat-mini-one-stop-shop


Mercia, I'm still trying to get my head round this. I have too low a turnover to register for VAT.

Do the new regs mean that, if I sell eBooks from my website to another EU country, I would have to register for VAT and charge it at the rate in the buyer's country? And keep records and send returns to the inland revenue?

I have read several articles about the legislation and the threat it poses to microbusinesses in the UK, and am thoroughly confused.

At the moment I only sell through Amazon and D2D, but I have friends selling eBooks through small publishers who are very concerned.


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## Ros_Jackson (Jan 11, 2014)

Vince Cable issued a response to the petition, which is really just a clarification of what we already knew: 

"Micro-businesses that trade to the UK and to the EU will have to register for VAT. But if they can separate out their cross-border business from their domestic they will only have to register for VAT on their cross-border sales. UK sales will be unaffected."

You can read the rest on the petition link I posted above. When it comes to ebooks, it can be hard to restrict your sales to people living in a particular country, especially if they buy whilst they're travelling.


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## TXRed (Jan 27, 2014)

Ye gads and little fishes. *shakes head* It's this sort of thing that makes me understand why some authors prefer to let a publisher do all the work. And like several other people, I had to read the letter through a few times for it all to make kinda sense, sort of.


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## Ancient Lawyer (Jul 1, 2013)

It isn't good news for anyone who wants to sell eBooks direct from their own web-site (or Etsy). It doesn't seem to affect those of us selling through Amazon and the other big sellers like Barnes & Noble, etc. But it seems like a backward step and a short-sighted decision by the EU.

Unfortunately, Vince Cable's response doesn't suggest much will to change things at the moment. (This is a bit UK specific)


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## Jennifer R P (Oct 19, 2012)

Nope.

The VAT threshold for cross-border sales of "electronic services," which includes ebooks, is now ZERO.

Everyone is going to have to register for VAT. That's why this is such a mess. One sale to anyone in any EU country triggers the registration requirement. If you sell through your own website, the only real way to comply is to use a full-featured e-commerce suite (I'm hearing good things about Fastspring).

Smashwords will also have to comply with this. Everyone will have to comply with this. And this is not Amazon's fault. Registering in Luxembourg to avoid paying higher VAT was honestly just good business sense. Now they're having to do what they need to do to make things easier and I think they're honestly trying not to screw over either authors or customers in a situation where it's hard for them to avoid.

The big problem/annoyance is not being able to see my prices in the Kobo UK store (for example) without finding somebody in the UK to check them for me so I can see what happens to/with my prices there and avoid stupid price matching. I WANT my books to be the same price at all retailers, but I don't want to suddenly see a price drop somewhere...ah well. I guess I'll have to recruit my aunt to help me .


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## Ros_Jackson (Jan 11, 2014)

Jennifer R P said:


> The big problem/annoyance is not being able to see my prices in the Kobo UK store (for example) without finding somebody in the UK to check them for me so I can see what happens to/with my prices there and avoid stupid price matching. I WANT my books to be the same price at all retailers, but I don't want to suddenly see a price drop somewhere...ah well. I guess I'll have to recruit my aunt to help me .


I think price-matching is specific to a currency. I do find it annoying, and expensive when I'm trying to do promotions, when I can't see how my books are priced in a country I'm not from.


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## Jennifer R P (Oct 19, 2012)

Yes, but if I don't know what Kobo UK has my books at, I don't know if it's the same or different as what Amazon UK has. The UK I can do, but I don't exactly have contacts in Germany, say, to check prices for me.


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## Leanne King (Oct 2, 2012)

Kobo don't discount, so your price should be whatever you set it to plus VAT. Unless you're going through an aggregator and can't set prices properly?


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## ThomasDiehl (Aug 23, 2014)

Jennifer R P said:


> Yes, but if I don't know what Kobo UK has my books at, I don't know if it's the same or different as what Amazon UK has. The UK I can do, but I don't exactly have contacts in Germany, say, to check prices for me.


No prob, there are wild Germans roaming this very board. Just put up a mousetrap. Or send a PM.


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## Kenson (Dec 8, 2014)

Extract from KDP letter



Elizabeth Ann West said:


> Royalties will continue to be calculated based on the list price without VAT. The amount of VAT applied depends on the country where the customer is located. Consider a book with a £6.00 VAT-inclusive price on Amazon.co.uk, for sales to customers in the UK we would apply the UK's 20% VAT rate and the price we use to calculate royalty would be £5.00. The 23% Irish VAT rate will apply to purchases from Ireland, so a customer buying from Ireland would still see £6.00 but, applying the 23% Irish VAT rate, we would calculate royalty based on the VAT-exclusive list price of £4.88.
> 
> Setting List Prices for EU Kindle stores
> 
> ...


I have a book out at $0.99 on kindle (ex sales tax). I also published it through D2D at the same price $0.99 under the impression (apparently mistaken) that it was also an ex sales tax price.

Now it's very kind?? of Zon to say that they will automatically update my kindle price to include sales tax but my question is what price will they then use for price matching? And in which countries?
Do I also have to update my price on D2D?
Or will Zon say your new price is now $1.11 but Aha! it's only priced at $0.99 on D2D therefore we're going to reduce your price to match and then deduct the sales tax before calculating the royalties.


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## Maria Romana (Jun 7, 2010)

Kenson said:


> Now it's very kind?? of Zon to say that they will automatically update my kindle price to include sales tax but my question is what price will they then use for price matching? And in which countries?
> Do I also have to update my price on D2D?
> Or will Zon say your new price is now $1.11 but Aha! it's only priced at $0.99 on D2D therefore we're going to reduce your price to match and then deduct the sales tax before calculating the royalties.


Yes, this is what I'm concerned about as well. I know that other countries are used to and expect tax-inclusive prices, but one of the reasons we in the US have always displayed tax-exclusive prices is due to the fact that sales tax rates vary not only by state but also by county and city. It would be impossible to price-compare products if you had to account for this; you could literally have hundreds, even thousands, of different prices for a single product. And now this will be the case with ebook prices (more so than before). Throw fluctuating exchange rates into the mix, and how can Amazon say with any authority what is actually the lowest price of your book on any given day?


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## 75845 (Jan 1, 1970)

Ros_Jackson said:


> Vince Cable issued a response to the petition, which is really just a clarification of what we already knew:
> 
> "Micro-businesses that trade to the UK and to the EU will have to register for VAT. But if they can separate out their cross-border business from their domestic they will only have to register for VAT on their cross-border sales. UK sales will be unaffected."


You have misunderstood Vince Cable's announcement, which is a dramatic development. UK based direct digital sales to EU businesses can register for VATMOSS and keep the £81,000 threshold for UK-based transactions, which VATMOSS does not deal with if you are UK-based, but of course you cannot claim to be VAT registered in any UK-based B2B transactions.

http://www.vatlive.com/european-news/uk-victory-2015-electronic-services-vat-moss-registrations/

The official details from the UK tax authorities is here:
https://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumers

The EU ideal is that no country would have a VAT threshold greater than £5000 but they have allowed UK and Ireland to keep their £80,000-ish thresholds. So I guess that explains why the EU was not too worried about the so-called VATMESS, they were hoping that it would persuade the UK and Ireland to drop their thresholds.

In other news the administrative burden is being delayed for six months for UK-based businesses.
http://www.vatlive.com/european-news/uk-digital-providers-6-month-holiday-customer-info/


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## Caddy (Sep 13, 2011)

Yes, you have to update on D2D. When you get to pricing, there is a button for it. You can use the prices AMazon has used to know what to put in. Some of them I don't worry about. I don't sell books in HOng Kong often enough to figure out VAT


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## Mark E. Cooper (May 29, 2011)

Jennifer R P said:


> Yes, but if I don't know what Kobo UK has my books at, I don't know if it's the same or different as what Amazon UK has. The UK I can do, but I don't exactly have contacts in Germany, say, to check prices for me.


Most of us use something like this to see foreign stores. There are lots of them out there. Just Google free proxy. https://hide.me/en/proxy


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## theaatkinson (Sep 22, 2010)

GAH! despite reading this thread a dozen times, I'm still cross-eyed and fog-minded. So many issues, so little brain power.

The lazy me wants to believe I can just auto set at Amazon, D2D, SW, and ARE and be done with it. I don't sell from my website. I typically don't set different prices in differing regions, because it has never seemed to make a difference in my sales anyway.

Please tell me I can be lazy and worry-free.... and not go through each title on every platform and region. I think I'd eat a dozen donuts then and go into a sugar coma.


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## katrina46 (May 23, 2014)

I'm just letting them do it.


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## Angela Ackerman (Jul 6, 2011)

Okay, question though...when Amazon adds the VAT, do they then also pay the VAT on our behalf, or pass on the tax collected for us to then submit through MOSS? Anyone know? I am baffled that B & N, Kobo and some others have not yet addressed this huge issue.


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## 75845 (Jan 1, 1970)

Angela Ackerman said:


> Okay, question though...when Amazon adds the VAT, do they then also pay the VAT on our behalf, or pass on the tax collected for us to then submit through MOSS? Anyone know? I am baffled that B & N, Kobo and some others have not yet addressed this huge issue.


They have not addressed it as it is not an issue. VAT is collected by the person making the B2C (business to customer) transaction, i.e., Amazon, Nook, Kobo, Apple, etc. MOSS is for selling from your own website where you make the B2C transaction. So each time a book is sold it is as if Amazon buy the book from you at list price, collect VAT and give that to the appropriate state, and then deduct their 30% or 65% retailing fee from what they pay you. Amazon has always added the VAT, the change is that they have come on board with Nook, Apple, and Kobo and ask us to enter a VAT inclusive price in KDP.


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## Angela Ackerman (Jul 6, 2011)

Thanks for clarifying, Mercia! I have been playing catch up all day trying to understand this situation and the impact it has on both sales through distributors and my own site.


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## J.M. Garlock (Oct 2, 2012)

Most of my sales are in the UK. I have three choices. 1) add the 20% VAT to the price of my book & risk alienating some buyers. 2) absorb the VAT & see my income decrease by 20%. 3) split the difference. Thank you EU Finance Ministers.
J.M. Garlock
"The Centurion Chronicles Books Oe, Two & Three"
"Knight Hunter: Vampires"


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## Guest (Jan 20, 2015)

Let's say we make sweaters instead of books.
We send our sweaters to Macy's.
It is up to Macy's in NC to add the NC sales tax. Macy's in CA adds the CA sales tax.
The manufacturer (us) can't keep up with the various taxing districts. It is up to the retailers to set their cash registers to the correct sales tax.
I think Amazon falls in the category of retailer. If Amazon passes on the sales tax, then Amazon should add it to the price in the various regions.
We are the manufacturer, not the retailer.


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