Online DVD prices to rise - tax loophole closed

Channel Islands no longer relieved

A tax loophole which allows tax relief when distributing DVDs from the Channel Islands has been effectively closed, with the UK High Court announcing the government is free to amend the current bill.

The sexily monikered Low Value Consignment Relief (LVCR) is something which companies such as Amazon, Play and Tesco – through agencies – took advantage of, offering tax free DVDs, Blu-rays and other goods through their distributions centres on the Channel Islands.

As of next month, however, this is set to stop – which will be relief to high-street stores which have been struggling to compete with cheaper online brands.

Tax loss lover

For customers who find shops a little too strange, there's likely to be fewer disc-based bargains on the web. This is because any good that's priced £15 or under will no longer be given a tax break.

The government has been looking to close the loophole for some time now. Originally LVCR was given to goods that were £17 or under but this was changed to £15.

With a new budget coming up, the chancellor wanted to get the loophole – which is said to cost the UK £150 million a year in lost VAT – closed but there is already talk of some companies moving their business to Switzerland, where tax relief remains.

Via the Guardian


Content Team Lead

Marc (Twitter, Google+) is the content team lead for Future Technology, where he is in charge of a 14-strong team of journalists who write many of the wonderful stories that end up on TechRadar, and T3 magazine. Prior to this he was deputy editor of TechRadar, had a 10-month stint editing a weekly iPad magazine, written film reviews for a whole host of publications and has been an integral part of many magazines that are no longer with us.