An online bookshop selling exclusively adult colouring books has said it is likely to be put out of business should government proposals to remove their exemption from VAT go through, and has lent its support to a petition in protest.
As previously reported by The Bookseller, although print books and children’s colouring books are currently exempt from VAT, HMRC is challenging the idea that adult colouring books can be classed as a book, and is questioning whether they could instead be categorised as ‘uncompleted’ books, which currently attract the full 20% rate of VAT.
Several publishers have received letters from the government’s tax department requesting money owed for VAT on adult colouring book titles after filing their end of year returns.
Joe Hodgkinson, who runs online retailer Adult Colouring, told The Bookseller that if the plans went through his business would be “80% likely” to close down, with independent companies like his set to suffer the most severely.
He said: “If the government backdated the money we would owe £2,000, as well as 20% of our profits moving forward. It depends on how quickly we could move into other areas of books, but when you’re a small independent company it’s already a struggle to keep up. Amazon and the big businesses won’t go out of business because they’re the ones who can afford to keep going.”
Adult Colouring is now urging its customers to sign and share an online petition in protest against the VAT proposals, started by self-professed “avid colouring therapy addict” Mary Hayes, which accuses the government of “trying to tax our therapy”.
The petition says: "I am an avid colouring therapy addict, just like thousands of people across the world and now the British government is trying to tax our therapy. We do this to escape from a lot of things in life for many it is the only luxury they have. Please don't tax our colour therapy.”
Hodgkinson began selling adult colouring books on eBay in February 2015 before starting his own site 12 months later. “My partner suffers from depression and anxiety and I looked at the books for her as an aid,” he said. “I’d noticed their rise in popularity after reading an article [about them] in April and they then became 85% of our business on eBay.
“The government is just jumping on the popularity of the books over the last year. Adult colouring books have been around since the 80s but now that they’re popular, with Johanna Basford selling a million copies, they’ve just seized an opportunity.”
He added: “It’s a shame they’re doing this now, especially when physical book sales have risen for the first time in years.”
An HMRC spokesperson previously said: “There’s been no change to the rules. Children’s colouring books are entirely free of VAT and there are no plans to change that. We are meeting with publishing representatives shortly to discuss the VAT treatment of adult colouring books.”
The spokesperson added that there was “no deadline” for the outcome of its talks with publishers.
The adult colouring book craze began taking off in early 2015 helping the trade to its first rise in print sales in eight years, up 6.6%, with titles such as Johanna Basford’s Enchanted Forest (Laurence King), and the Harry Potter Colouring Book (Studio Press) selling in high volumes.