The JEP is asking Amazon UK to respect the Island’s tax sovereignty and stop charging value added tax on its Amazon Prime.
Jersey’s subscribers to Prime – which offers one-day delivery on some items, streaming of movies and TV shows as well as access to music and Kindle books – are being charged the same rate as customers in the UK, despite Jersey being a VAT-free zone. While VAT is usually removed by Amazon on incoming parcels to the Channel Islands, the Prime service is still charged at a generic UK rate of £7.99 per month, which includes VAT, according to the retailer’s website.
The Jersey Consumer Council has thrown its support behind the campaign.
‘The charging of VAT or VAT-equivalent prices in Jersey is unfair and something which the Consumer Council has highlighted on many occasions in the past,’ said chairman Carl Walker. ‘While there appears to be little in place to force retailers shipping goods or sending services to the Channel Islands to remove the UK tax, campaigns, including this latest one from the JEP, will at the very least allow Islanders to make more informed decisions.’
Those signing the petition felt the online retailer should honour Jersey’s tax arrangements.
‘We are being ripped off,’ wrote Madeleine Want on petition website change.org.
‘Jersey is not part of the UK,’ added Richard Miles. ‘It is an independent, self-governing jurisdiction and charging its citizens UK VAT is illegal under international law.’
While signatures are mounting on change.org, not everyone supports the call for tax fairness.
Some took to social media to complain that the newspaper may ‘ruin’ Amazon Prime for Islanders.
‘This is stupid,’ wrote Tim Baudains. ‘Do you not realise that it costs Amazon more to ship to Jersey than mainland UK? And most of the service – the Amazon TV and Library – are not physically shipped anyway and so [we] pay tax at the rate in the country of origin. Prime is still excellent value for money – maybe don’t rock the boat, as they may decide to just stop offering it here?’
Amazon has done little to respond to complaints from Channel Islanders about VAT on Prime memberships.
The company’s press office said Prime was a ‘unique service, and while different locations are subject to different operating costs, it represents great value for our customers wherever it’s available’.
VAT is charged at a standard rate of 20 percent, but on services such as Prime it can be more variable. Neither Amazon UK nor HMRC would clarify the rate of VAT applied to Amazon Prime UK subscriptions. However, Jersey should not pay the same as the UK rate as, under European rules, the VAT on streaming services should be that charged at the consumer’s location.
