Hachette Livre denies VAT evasion in France

Hachette Livre denies VAT evasion in France

<p>Hachette Livre has denied allegations in a French newspaper that it has any subsidiaries registered in Luxemboug. The publisher was referring to an interview with right-wing member of parliament Herv&eacute; Gaymard, who said that &quot;publishers like Hachette Livre with Numilog have domiciled their electronic platforms in that country.&quot;</p><p>Gaymard was making the point that if VAT was reduced on e-books then the government would not lose any money, since publishers were already circumventing the law by domiciling their businesses in Luxembourg, which applies a lower rate. &quot;If the (VAT) rate were reduced, these companies would return to France. It is therefore inaccurate to say that the government would lose money if the rate on digital books were cut.&quot;<br /><br />Hachette said in a statement it has no Luxembourg-registered subsidiary, that its wholly-owned ebook distributor Numilog has been based in the Paris region since it was created in 2002, and that the group &quot;has never envisaged relocating any of its French activities abroad.&quot;<br /><br />Last week, the National Assembly, or lower house of parliament, threw out an amendment to the 2011 budget to bring VAT on ebooks down fromp 19.6% to the 5.5% reduced rate applied to print books. The reason given for the rejection was that the cut was not compatible with European law on books and digital content.<br /><br />A VAT cut is urgent and so is a law on fixed prices for ebooks in order to &quot;keep new players like Google and Amazon in their place,&quot; Gaymard asserted, who is probably the book trade&rsquo;s most ardent defender in parliament.<br /><br />&quot;These two companies tried to ride roughshod over publishers, and now they are having to negotiate. The standoff continues, but we must have a legal framework to permit cultural diversity to develop.&quot;<br /><br />Gaymard added there was no parliamentary opposition to a bill on fixed prices for electronic versions of printed books and that it should become law at the beginning of next year if time can be found for an Assembly vote before the end of December.<br /></p>