Sunday, May 26, 2013

Evo Morales: the VAT man


Every country can tax books as convenient. In the European Union, for instance, there are remarkable differences: Spain and Italy tax books at 4%, whereas Denmark taxes books at 25%. The EU countries with lowest taxes on books are Luxemburg, at 3%, and the United Kingdom, at 0%. Such differences between countries led the virtual bookstore Amazon to move its European headquarters to Luxemburg, where salaries are rather high but taxes are very low.
Moreover, taxes are also different if we talk about print books or e-books. In Spain, for instance, e-books are taxed at 21%, whereas print books are taxed at 4%. In order to end up with such big differences, the European Commission is planning to unify criteria by the end of the year 2013 (to be in force by 2015).
Needless to say, the price of books affects the reading rates. Therefore, printing houses and other institutions which promote reading habits advocate for low taxes on books. In the case of Spain, having a fixed price for books (which lets small- and medium-sized bookstores survive) and paying a reduced VAT of 4% are good measures to promote reading.
Some days ago, the president of Bolivia Evo Morales passed some acts to promote reading habits among Bolivians, including a National Library Network with funds to buy contemporary literature and the suppression of taxes on books (it was 13%) and on book transaction (it was 3%). Thanks to these measures, Bolivians can buy books 16% cheaper.
When announcing these measures, Evo Morales talked about a major problem in Bolivia: the low reading rate. And he set himself as a good example because he admits that he rarely reads a book. However, most Spanish newspapers gave a new nuance to this piece of news and the headlines were “Evo Morales does not like to read”. Only the small print revealed that the Bolivian government will pass some measures to promote reading. And not all newspapers included this information either.

Some examples:
El Mundo: «Evo Morales: "I don’t like to read"»:
http://www.elmundo.es/america/2013/04/30/noticias/1367307011.html
ABC: «Evo Morales: "I don’t like to read "»:
http://www.abc.es/internacional/20130430/abci-morales-gusta-leer-201304300833.html
La Vanguardia: «Evo Morales: "I don’t like to read"»:
http://www.lavanguardia.com/internacional/20130430/54373016764/evo-morales-no-me-gusta-leer.html
El País: «Morales admits that he does not like to read after passing a law to reduce taxes on books»:
http://economia.elpais.com/economia/2013/04/30/agencias/1367286502_156441.html
El Periódico: «Morales admits that he does not like to read»:
http://www.elperiodico.com/es/noticias/internacional/morales-admite-que-gusta-leer-2378316
20 Minutos: «Evo Morales admits that he does not like to read: "I have this problem"»:
http://www.20minutos.es/noticia/1801885/0/evo-morales/no-gusta-leer/baja-impuesto/
La Gaceta: «Evo Morales does not like to read»:
http://www.lagaceta.com.ar/nota/542975/mundo/a-evo-morales-no-le-gusta-leer.html
Libertaddigital / esRadio: «Evo Morales: "I don’t like to read"»:
http://esradio.libertaddigital.com/fonoteca/2013-04-30/cultura-evo-morales-no-me-gusta-leer-58173.html

Sources:
  1. VAT policies on books around Europe: http://publishingperspectives.com/2012/07/why-is-europes-policy-e-books-so-schizophrenic/
  2. Amazon in Luxemburg: http://www.reuters.com/article/2012/12/06/us-tax-amazon-idUSBRE8B50AR20121206
  3. VAT rates in Spain: http://www.tumbit.com/how-to-guides/articles/93-spanish-iva-explained.html
  4. Fixed book price: http://en.wikipedia.org/wiki/Fixed_book_price_agreement
    
    
   
   
   

2 comments:



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