The South African government is reportedly about to enforce a blanket sales tax on all national/international e-commerce from 1st April 2014. South African ejournal subscribers report that, in combination with a weak currency, this will amount to an immediate cut of “about 40% of their purchasing power” when buying international ejournal subscriptions. It seems that anyone selling ejournals/ebooks, online music and other virtual goods (or even online services) into South Africa after 1st April is required to register for sales tax with the South African government, or face two years in prison.

Sales tax changes are also afoot in the UK and EU, and will affect academic e-content buyers. Most ebooks (and iTunes music, Xbox games, and VOD video) have previously been sold into the UK from the tiny nation of Luxembourg where VAT was set at a low rate. The EU has scrapped that work-around, and is shifting control of taxing e-commerce back to the purchaser’s nation. For UK scholars this seems to mean that by 2015 we’ll see a 15%+ rise in the purchase price of individual ebooks from the likes of Amazon.

As for academic ejournals their sales tax in the UK is already set at a whopping 20%. And as far as I know no paywall publishers rushed over to Luxembourg, just in order to save our libraries a few pounds. UK government states that this 20% tax is not changing any time soon (unless we leave the EU)…

There is no scope with the existing EU VAT [sales tax] legislation to introduce a zero or reduced rate for ebooks or ejournals. (Hansard, the Business, Innovation and Skills Committee, on 4th April 2013).

It seems that there’s little left to tax these days, and a South African style blanket sales tax on all ecommerce sales and services is going to be tempting many grasping governments around 2016.

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