[TWLuedke]

http://www.wsj.com/articles/eu-court-rules-e-books-are-services-not-goods-1425552050?et_mid=730693&rid=241005945

Add this to the fact they just finished cramming VAT down every online retailer of ebooks across the world, and what I see is a pattern:

European fatcat corporate publishers and their corrupt influence are attacking the ebook industry (indirectly an attack on Amazon), in order to slow the progression of the ebook explosion, which steals directly from their pockets as discoverability is stripped away from them and given to Indies via Amazon's empowering influence on the market.

I'm not an Amazon preacher by any means, I absolutely hate what they are doing with Kindle Unlimited, its ruining the Indie ebook market, but I call foul when I see it.

European fatcat publishers are using legislators to shove roadblocks in front of the digital explosion, hoping to slow down Amazon and Ibooks.

 

[TWLuedke]

Why, did 'European fatcat publishers' write EU tax laws?

The ECJ *has* to make rulings in accordance with the EU's existing tax laws; the article you linked to said they're considering changing it, which means that, actually, they're being very considerate of the ebook industry.

Tax laws exist for complex reasons; changing such laws across the EU is a big deal, and not something to be taken lightly. The ECJ has to take into consideration many different industries and professions.

These tax rates are being "considered," after applying VAT to all online retailers across the world, forcing them into the tax fold. How convenient...

Sure, there are tons of reasons tax legislation happens. There are also tons of influences from large corporate entities on tax legislation. The timing of these two VAT moves, in conjunction with the ebook market explosion across Europe, is really conspicuous.

Then, when you look at the history of EU member countries and publisher organizations, the way they have repeatedly tried to hamper the ebook industry, specifically Amazon...

For a guy who writes fiction, I simply cannot help but see the intricately entwined workings of a potential conspiracy.

But maybe I'm totally wrong. Maybe its all just the ramblings of a fiction author. I can live with that. Still, the conspiracy theory is so much juicier and interesting.

 

[Flay Otters]

There's always a conspiracy.
The only question is whether or not you can see it.

Government is like the mob.
They demand protection money and if you don't pay they beat you up and steal your stuff.
All the while muttering: "Roads and bridges, roads and bridges."

 

[Leanne King]

These tax rates are being "considered," after applying VAT to all online retailers across the world, forcing them into the tax fold. How convenient...

Er, those online retailers accross the world have always been liable to charge VAT to their customers in the EU. Nothing's changed for them, only the retailers who are based in the EU.

 

[Tyler Danann]

Why, did 'European fatcat publishers' write EU tax laws?

The ECJ *has* to make rulings in accordance with the EU's existing tax laws; the article you linked to said they're considering changing it, which means that, actually, they're being very considerate of the ebook industry.

Tax laws exist for complex reasons; changing such laws across the EU is a big deal, and not something to be taken lightly. The ECJ has to take into consideration many different industries and professions.

This is yet another reason to leave the money-sucking EU! I never voted for it, but my hoodwinked forefathers did in the 1970s when it was JUST a trading organization.

 

[Jennifer R P]

What's changed is that in the past these online retailers could put an EU presence in a country with a low VAT rate and charge only that rate, undercutting local businesses. Amazon, for example, would charge VAT at Luxembourg rates (three point something percent) when some countries have 20% rates.

And ebooks have been legally considered "software" from the start. This has always been the case, so the court hasn't ruled anything important. It requires a change to the law to have them be treated as books. Which I agree they should be, but right now they are not.

This is not news.

 

[Vaalingrade]

Failure at instantly complying with your personal desires does not a conspiracy make. Nor fair taxes a theft.

eBooks are no more special than any other digital good and they're being treated as such.

 

[alawston]

Paranoid nonsense, I'm afraid.

All publishers sell e-books. It's not in any publisher's interests to lobby for higher taxation of those e-books.

 

[thewitt]

Three major things happened here that rocked our world.

1) The EU changed the rules so that VAT rates for online retailers would be charged at the BUYERs destination, not the SELLER.

2) The EU ruled that eBooks are NOT the same as Print Books when it comes to VAT - upholding the 20+ year old classification scheme

3) The EU is FORCING countries who are charging lower VAT rates for eBooks - like France at 5.5% - to raise their rates to match their other VAT Taxed products.

You can decide if this was done to punish online retailers or not, but the changes have definitely impacted sales of eBooks in EU countries.

Small online retailers are simply not able to sell to EU customers now, since the tax reporting requirements are financially prohibitive.

 

[Daphne]

When is a book not a book? When EU law defines an eBook as an "electronic service" for tax purposes. To be honest, whatever the motives behind this, it does clearly defy all sense and logic.

Three major things happened here that rocked our world.

1) The EU changed the rules so that VAT rates for online retailers would be charged at the BUYERs destination, not the SELLER.

2) The EU ruled that eBooks are NOT the same as Print Books when it comes to VAT - upholding the 20+ year old classification scheme

3) The EU is FORCING countries who are charging lower VAT rates for eBooks - like France at 5.5% - to raise their rates to match their other VAT Taxed products.

You can decide if this was done to punish online retailers or not, but the changes have definitely impacted sales of eBooks in EU countries.

Small online retailers are simply not able to sell to EU customers now, since the tax reporting requirements are financially prohibitive.

Exactly. Likewise, selling pre-made book covers to the EU (also defined as a digital service) makes no sense to me as it seems that the seller has to account for the VAT, which would be a nightmare of administration and accountancy.

 

[RA Books]

Tell me about it Setting the limit for registration for VAT on electronic services at £0 instead of the same VAT threshold as everything else (£81,000) makes no sense and hits small businesses and sole traders hard. Why one rule for VAT on electronic services and another for everything else? (Yes this is UK Govt. policy - see here)

It effectively forces people to use platforms instead of selling directly or incur the overhead of VAT accounting.

 

[Michael Kingswood]

Umm.....guys.....

In case you hadn't noticed, ebooks have NEVER been books, per say.  In most ebook stores, you do not buy the content, and you never have.  You buy the license to access the content.  Therefore, the court is entirely correct - an ebook IS a service, not a product, because no product actually has changed hands.

 

[CoraBuhlert]

When is a book not a book? When EU law defines an eBook as an "electronic service" for tax purposes. To be honest, whatever the motives behind this, it does clearly defy all sense and logic.

It's a stupid decision and one with which almost all publishers, writers and readers in the EU disagree. However, that decision was made approx. 20 years ago at a time when the Kindle wasn't even a glimmer in Jeff Bezos' eye and e-books meant something like Microsoft Encarta on CD-Rom.

 

[thewitt]

Umm.....guys.....

In case you hadn't noticed, ebooks have NEVER been books, per say. In most ebook stores, you do not buy the content, and you never have. You buy the license to access the content. Therefore, the court is entirely correct - an ebook IS a service, not a product, because no product actually has changed hands.

You don't buy the contents of a print book either. Yes you buy the paper, but I still own the copyright on the content.

The world is changing. The lawmakers need to wise up along with it.

An eBook is not a service. That's utter nonsense.

 

[Michael Kingswood]

You don't buy the contents of a print book either. Yes you buy the paper, but I still own the copyright on the content.

The world is changing. The lawmakers need to wise up along with it.

An eBook is not a service. That's utter nonsense.

With a print book, you own the physical book, and can do what you like with it. With an ebook, you do not own it or the content - you only purchase a license to access it on your reader. Since you do not have any ownership of an ebook you buy, you have in fact only purchased a service, nothing more.

Read the TOS. The court is only upholding the contract that you, I, and all the other ebook customers out there agreed to.

 

[RA Books]

With a print book, you own the physical book, and can do what you like with it. With an ebook, you do not own it or the content - you only purchase a license to access it on your reader. Since you do not have any ownership of an ebook you buy, you have in fact only purchased a service, nothing more.

Read the TOS. The court is only upholding the contract that you, I, and all the other ebook customers out there agreed to.

Problem is that every other service requires you to be a corporate entity reaching a certain level of earnings before you register for VAT. Under this digital services rule people have to register and start doing VAT accounting the moment they sell anything to a consumer in the EU - and record where the consumer lives when they buy the item. It's in the laws I linked to above.

Amazon as a platform does it for you, but any author selling their own books directly is affected. The Guardian has a full piece on the implications here.

 

[KL_Phelps]

All the while muttering: "Roads and bridges, roads and bridges."

and if they ever spent all the money they claim they were going to on roads and bridges, every square inch of the country would be either a road or a bridge

 

[ML-Larson]

It's a stupid decision and one with which almost all publishers, writers and readers in the EU disagree. However, that decision was made approx. 20 years ago at a time when the Kindle wasn't even a glimmer in Jeff Bezos' eye and e-books meant something like Microsoft Encarta on CD-Rom.

Honestly, I'm not sure I see the difference between buying Encarta on CD-ROM and buying an ebook.

How are streaming services like Netflix and LoveFilm taxed? Because they operate in the same way services like KU operate. You pay the monthly fee which gives you access to licensed content for a pre-set, limited term. You're not buying movies. You don't own all those Doctor Who episodes you watched last week.

I'm not sure how digital cable and satellite providers operate elsewhere, but here you can "buy" a digital copy of a movie and... idk, let it sit on your cablebox or something? It's always seemed super dodgy to me, because you don't actually own that movie. You just own the rights to watch it as often as you want, so long as you stick with your cable provider. Buying an ebook from Amazon is the same thing. You don't actually own it. You just own the rights to read it, so long as you keep your Amazon account (which is, to be fair, a much smaller irritation than staying with the same crappy cable company for the rest of your life). But there's always the worry that the title might disappear from Amazon. Then what happens when you upgrade your Kindle, or switch to Android or Apple? You can't take that title with you, because it's no longer there to be re-downloaded. Now, you're stuck with your old Kindle with the broken screen and the button that doesn't work right, just to read that one book again.

 

[Jane Killick]

I read about this on The Passive Voice and my understanding is that this was a legal adjudication by a court. In other words, the existing law was looked at and interpreted. Now we have a clear ruling which makes the law in this area plain.

The article then went on to say that EU ministers (well, France and Luxembourg anyway) were looking at changing the law to bring parity between VAT rates on physical books and on ebooks. So it's not that the EU wants to penalise the ebook industry, it just takes bureaucracies time to catch up with fast moving industries.

Here's the link to the PV article which, in turn, links to the full article at the Wall Street Journal.

http://www.thepassivevoice.com/03/2015/eu-court-rules-e-books-are-services-not-goods/

 

[horst5]

There's always a conspiracy.
The only question is whether or not you can see it.

Government is like the mob.
They demand protection money and if you don't pay they beat you up and steal your stuff.
All the while muttering: "Roads and bridges, roads and bridges."

They also mumble: "For the schools, for the children, for the schools!" When they really mean: "For my retirement account, for my retirement account...."