French Senate reduces VAT on e-books

French Senate reduces VAT on e-books

<p>The French Senate has adopted an amendment to the 2011 draft budget to reduce VAT on e-books from 19.6% to the reduced rate of 5.5% that applies to print.<br /> <br />The rate would cover only unenriched digital versions of print books to avoid competition being distorted in a market that &quot;is strongly affected by fiscal dumping in certain members of the European Union,&quot; the upper house of parliament said in a statement.<br /> <br />Dismissing advice from the government that the amendment violated European law, senator Catherine Morin-Desailly said that the lower rate would help develop legal downloads and should be introduced for all cultural products sold online. The Senate had already voted unanimously in favour of the cut rate for e-books when it adopted a bill on prices, she noted. &quot;We must show coherence,&quot; she said.</p><p> Budget minister Fran&ccedil;ois Baroin was reported to have pleaded for the amendment to be rejected, and to have reiterated that the government is working towards a consensus in the 27-member European Union to reduce VAT on e-books. <br /> <br />The amendment is to be discussed again by the National Assembly, which threw the proposal out last month because it was deemed to contravene European law. </p>