Entertainment retailer HMV is to begin offering VAT-free games via instore kiosks, under a new initiative called HMV Delivers.
According to a report in The Guardian, the company plans to extend the controversial VAT-avoidance scheme used by the company's website to stores across the UK, offering games, CDs, DVDs and Blu-ray movies minus the 17.5 per cent charged on items by the UK Treasury.
Many online retailers take advantage of the loophole that allows VAT exemption for products under GBP 18 that are imported into the UK from outside of the European Union.
HMV.com and Jersey-based Play.com already operate schemes to take advantage of the legal loophole originally designed to minimise the administration burden on marginal trade.
HMV has said that products on offer via the instore kiosks will be restricted to products not available on store shelves, according to the report.
View: Games Industry
According to a report in The Guardian, the company plans to extend the controversial VAT-avoidance scheme used by the company's website to stores across the UK, offering games, CDs, DVDs and Blu-ray movies minus the 17.5 per cent charged on items by the UK Treasury.
Many online retailers take advantage of the loophole that allows VAT exemption for products under GBP 18 that are imported into the UK from outside of the European Union.
HMV.com and Jersey-based Play.com already operate schemes to take advantage of the legal loophole originally designed to minimise the administration burden on marginal trade.
HMV has said that products on offer via the instore kiosks will be restricted to products not available on store shelves, according to the report.
View: Games Industry
On the other hand, how many current-gen games are there for < £18?
17.5% or 17.5 pence in every 100 pence you spend.
Or a scam to fleece shoppers of even more money.
HMV like all stores in Britian should offer v.a.t. free games, music, DvD etc, by selling them via Jersey like amazon does.
Anything less than £17.50 is v.a.t. free.
Even more money? Who do you think gets the money from the sale?
This is just like Tesco using Tesco Jersey to deliver cheaper items VAT free.
I expect that the income from kisok sales wll be sent through the HMVD business rather then through the actual store, therefore bypassing the VAT requirements.
Well OK - that's not true. "Play.com" does - but Play.com is owned by "The Web Factory" - which is based in Cambridge. EVERYTHING is done by The Web Factory, with Play.com simply being a big warehouse in Jersey. I'm talking IT, HR, Customer Services, Finance, Sales, Marketing, Management.... There's only warehouse operatives and a manager in Jersey...! :-)
Turn Play.com's website into a physical shop like HMV, and it's essentially same.
http://en.wikipedia.org/wiki/Value_added_tax
I remember when VAT was 15%...
I bought something from the Valve store in the US a while back, and I was charged quite a lot, although part of that was FedEx trying to extract money from me that I didn't owe them. I don't mind if it's a big purchase, it's the law - but that sort of an addition to something less than £18 is stupid - the reason the loophole was introduced in the first place, I suspect.
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