EU finance ministers agree to cut tax rates on e-books

Luxembourg (dpa) - EU finance ministers have signed off on a proposal to allow member states to set low or zero tax rates on electronic books and media, according to a joint statement released Tuesday. At present, the value added tax (VAT) among EU member states varies considerably between print and electronic publications. The minimum VAT on print products is 5 per cent, compared to 15 per cent on digital products.Under the new plan, which was proposed by the European Commission, member states would have the flexibility to set lower or zero rates on e-publications."This proposal is part of our efforts to modernise VAT for the digital economy, and enables us to keep pace with technological progress," said Austrian Finance Minister Hartwig Loeger in a press release. Austria, which currently holds the rotating EU presidency, was one of the key backers of this plan.The finance ministers also agreed on four other VAT proposals. These cover how stock is transferred across state borders, VAT identification numbers for customers, VAT treatment of chain transactions, and proof of intra-EU supply.The broader purpose of these fixes is to better harmonize VAT regulations across the EU, the press release said.