Taxing Dragons

Dragoncharm EbookYou may recall, dear reader, my plans to create an e-book edition of my 1995 debut novel, Dragoncharm. Sad to say those plans are not progressing. No sooner do I find myself between ghostwriting assignemnts – and therefore with a window of opportunity during which I can turn my attention to less, er, ghostly things – than I’m find myself face to face with the tax man.

Generally speaking, my relationship with the tax man is good. However, from 1 January 2015, new EU VAT rules mean that any business, large or small, selling “automated digital services” to the European market must now charge value added tax. Such services include all digital downloads, except those custom-made to order, and include e-books.

The upshot of this is that a vast number of microbusinesses and sole traders who previously had no need to swim the bureaucratic ocean of VAT-registeration must now do so. Furthermore, they must embrace the knowledge that VAT rates and laws work differently in every European country, so one size does not fit all. This and other complications mean that, in short, it may be impossible for most businesses actually to comply with the new laws.

As the EU VAT Action protest website says:

The new EU VAT legislation brings corporate levels of regulation and administration not just to the Boardrooms, but also to the kitchen tables of sole traders. Thousands of the smallest businesses cannot physically comply with the data requirements and are faced with a stark choice at the end of this month – either to close their cherished businesses or to break the law. That is not a reasonable choice to force them to make.

Right now, this doesn’t affect me. I don’t personally sell digital downloads – all my ebooks are available through conventional publishing channels.

If I choose to self-publish, that will change.

“Why don’t you sign up with Amazon?” I hear you cry. “Aren’t they acting like publishers these days? Don’t they deal with all that tax nonsense?” Well, yes, that’s a possibility, but it’s not yet clear how robust any commitment made by Amazon – or indeed by any of the other companies offering self-publishing options – to manage the whole VAT mess might be.

If I sound defeatist, it’s because that’s how I feel. My tolerance for – and understanding of – business and tax matters is rudimentary at the best of times. My time is better spent putting down the damn words. Anyway, the Dragoncharm e-book is a vanity project at best, and not worth sleepless nights. So, for now at least, it’s on hold.

Don’t feel sorry for me, by the way. Frustrated as I am (can you tell?) this isn’t nearly so much of a big deal for me as it is for the hundreds of thousands of small businesses and sole traders who, with these new laws in place, are in real danger of having their cottage industries collapsing about their ears.

Comments

  1. Dorothy Emry says:

    Thanks for the link to EU VAT action. This definitely sounds like a big mess for all of us. As a U.S. author, I’ve been so pleased that there’s the opportunity to sell outside the U.S. but now it sounds like that freedom may end at least until all this gets hammered out. The fact that these laws are open to interpretation (and therefore misinterpretation) says to me that more time needed to be taken to think through the whole system. What a shame.

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