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Amazon N Tesco Go For Jersey


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Back to the original thread subject...

 

Not all is rosey in Jersey's export market.

 

(Quoted in full due to This Is Jersey's crap archive methods)

 

A Major player in Jersey's fulfilment industry is being taken to court by the UK government.

 

Dolland & Aitchison, which sells contact lenses from the Island, is facing legal action from HM Customs & Excise, who think the optical firm owes them millions of pounds in VAT. D&A - the oldest retail chain on the UK high street - is one of a number of firms that have established a base in Jersey to take advantage of the Island's lack of VAT.

 

Under European law, items under £18 imported into the EU are exempt from VAT. As Jersey is outside the EU but within its customs boundary, it is perfectly placed to take advantage of this 'low value consignment relief' and many firms, including Tesco and Amazon, have set up in the Island to distribute goods sold over the internet.

 

The fulfilment industry is flourishing in Jersey and is now worth, in sales terms, more than tourism and agriculture combined. But HM Customs thinks D&A is flouting the rules.

 

A Customs spokesman said: 'D&A send out invoices which are over the £18 deminimus threshold. They argue that the contact lenses themselves are worth less than £18 and the rest is for professional services, which are not subject to VAT. 'But we argue that the payments customers make is for a single supply of goods and the lenses and the services should be lumped together.

 

We are taking the case to the European Court of Justice but are not expecting a judgment until the end of 2006.

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Hahaha, surely they'll just invoice the two separately from now on then yes?

 

I've been adding to my cd collection a bit over the last two weeks and had quite a bit of it come from Jersey. Very prompt service too, got here quicker than the stuff from Amazon HQ. :D

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Potential changes to the distance selling rules could also mean that the supplier could be eligible to register for VAT in the country in which the consumption of the goods takes place. The Jersey thing was a short term loophole that was always going to get looked at especially with Brown on an anti-avoidance crusade.

 

The IOM should never come out of the Customs Union, it would be a financial disaster for the Island and would make my business unworkable!

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