VAT-free iTunes music?

Apple is reportedly looking to so it sell music to British customers--without charging the nearly 18 percent value added tax (VAT). That could reduce the price of iTunes music from 79p to 67p, according to the report.

The move mimics that of other UK retailers, such as Tesco, Asda, Britannia, HMV, Amazon and Woolworths, which have "set up delivery operations in the Channel Islands to exploit a law which allows retailers outside the European Union to sell goods worth less than £17 to UK consumers free from VAT," according to the report.

"These fulfilment businesses have allowed retailers to sell CDs and DVDs by mail order usually for between £3 and £5 cheaper than high street shops.

"Apple confirmed that it is looking at setting up a similar operation on Guernsey. This would allow it to lower the prices of music downloads from 79p, perhaps to as little as 67p."

by MacNN Staff