Online retailers including Amazon and see Channel Islands VAT loophole closed

Online retailers such as Amazon, and HMV will be forced to stop selling VAT-free DVDs, CDs and other merchandise with a legal loophole set to be closed.

The retailers have been buying the goods from the Channel Islands, which is exempt from VAT, and where all goods bought for under £15 and then imported into the UK, are exempt from also VAT.

The VAT-free loophole will be closed after a legal challenge by the Channel Islands was dismissed yesterday, the Guardian reported.

The Guardian newspaper, alongside several retailers including Fopp and Holland & Barret have campaigned to the Treasury for years as the companies were struggling to compete with VAT-free prices.

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