07 Jan 2015

On January 1st 2015 new European Union legislation came into effect which changes the way that VAT is calculated on eBooks sold within the EU. Previously VAT was calculated based on the retailer’s country but now it is based on the VAT rate of the country where the customer is resident.

Amazon, Apple, Kobo and NOOK base their European operations in Luxembourg with its 3% VAT rate, which previously applied to all sales in the EU. With the new legislation VAT applied to eBook sales will now be based on the rates displayed at the bottom of the page.

Changes to your Amazon EU prices and your per sale royalties from other channels

In response to the European Union legislation changes it is likely that your Amazon list price for EU territories have increased.

Although other channels will maintain your current list price, the VAT increases mean your royalties per sale will fall.

Please note that the royalty rate information below is based on the accounts we have with each distribution channel and may differ from those offered by other eBook distribution services or aggregators.

What this means for KDP sales through Amazon.co.uk

The price of your eBook on Amazon.co.uk may have changed on January 1st.

For eBooks in the 70% Royalty Option

The minimum UK£ list price (including VAT) for eBooks within Amazon’s 70% royalty pricing bracket has changed from £1.53 to £1.99.

The maximum price has increased from £8.04 to £9.99.

If your eBook was previously in the 70% royalty option and priced between £1.53 and £1.70 the price will have changed to £1.99.

If your eBook was previously priced between £1.71 and £8.04 the price will have increased by 17% (the difference between the Luxembourg VAT rate of 3% and the UK VAT rate of 20%).

For eBooks in the 35% Royalty Option

The minimum UK£ list price (including VAT) for eBooks within Amazon’s 35% royalty pricing bracket has changed from £0.77 to £0.99. If your eBook file is between 3mb and 10mb the minimum price is £1.49. If it is larger than 10mb the minimum price is £1.99.

The maximum price has increased to £150.

If your eBook was previously in the 35% royalty option and priced between £0.77 and £0.85 the price will have changed to £0.99.

If your eBook was previously priced between £0.86 and £120 the price will have increased by 17% (the difference between the Luxembourg VAT rate of 3% and the UK VAT rate of 20%).

What this means for KDP sales through Amazon.de, Amazon.fr, Amazon.es, Amazon.it and Amazon.nl

The price of your eBook on Amazon’s EU stores may have changed on January 1st.

For eBooks in the 70% Royalty Option

The minimum EU€ list price (including VAT) for eBooks within Amazon’s 70% royalty pricing bracket has changed from €2.68 to €2.99.

The maximum price has remained €9.99.

If your eBook was previously in the 70% royalty option and priced below €2.99 the price will have increased to whichever of the following is higher; €2.99, or an increase of the difference between the VAT rate of the relevant region (see the list above) and the 3% Luxembourg VAT rate (e.g. In Spain the price will increase by 18%, the difference between 3% and the Spanish VAT rate of 21%).

If your eBook was priced €2.99 or higher the price will have increased by the difference between the VAT rate of the relevant region (see the list above) and the 3% Luxembourg VAT rate, to a maximum of €9.99.

For eBooks in the 35% Royalty Option

The minimum EU€ list price (including VAT) for eBooks within Amazon’s 35% royalty pricing bracket has changed to €0.99. If your eBook file is between 3mb and 10mb the minimum price is €1.99. If it is larger than 10mb the minimum price is €2.99.

The maximum price has increased to €215.

If your eBook was previously in the 35% royalty option the price will have increased to whichever of the following is higher; €0.99, or an increase of the difference between the VAT rate of the relevant region (see the list above) and the 3% Luxembourg VAT.

What this means for KDP sales through Amazon stores outside the EU

These sales are not affected by the new legislation and your non-EU prices and royalties will remain the same.

Can I change back to the original list price?

Yes, if you would like to return your eBook price to the original list price we can do this for you but please take into account the following:

  • The minimum and maximum prices for the 70% and 35% royalty options have changed. If you list your eBook lower than £1.99/€2.99 or higher than £9.99/€2.99 you will only receive 35% royalties.
  • Your royalties for each sale will be lower because the amount deducted for VAT will be higher. A title sold for £2.99 in 2014 would have generated approximately £2.00 royalties, in 2015 it would generate nearer £1.65.

If you would like us to change your pricing on Amazon please email helpdesk@ebookpartnership.com with details of your titles and required changes.

What happens if I keep the new price and have lower prices on other channels?

If you maintain the new, higher prices on Amazon you may find that Amazon request that you either increase your list price with other retailers so they have the same list price as Amazon, or that you decrease the list price on Amazon to match that of the other retailers. If you fail to respond to such a request you may find that Amazon temporarily  remove your eBook from their stores until the list prices have been matched.

What this means for sales through Apple iTunes and iBooks

Your list price will remain unchanged but your royalty amount for each sale within the EU will decrease.

For example, your royalties for an eBook sold to a UK customer in 2014 for £4.99 would have been as follows:

List price: £4.99
less 3% VAT: (£0.15)
Amount after VAT deducted: £4.84
Apple’s commission (30%): £1.45
Your royalty (70%): £3.39

With the 2015 changes the calculation would be:

List price: £4.99
less 20% VAT: (£0.83)
Amount after VAT deducted: £4.16
Apple’s commission (30%): £1.25
Your royalty (70%): £2.91

What this means for sales through other channels

With the exception of Amazon, as detailed above, the other retailers and distribution channels will not change your list price but will instead deduct the relevant VAT amount from any sales before calculating your royalty payments.

Country VAT Rate Applied to eBooks
Austria 20%
Belgium 21%
Bulgaria 20%
Croatia 25%
Cyprus 19%
Czech Republic 21%
Denmark 25%
Estonia 20%
Finland 24%
France 5.5%
Germany 19%
Greece 23%
Hungary 27%
Ireland 23%
Country VAT Rate Applied to eBooks
Italy 4%*
Latvia 21%
Lithuania 21%
Luxembourg 3%
Malta 18%
Netherlands 21%
Poland 23%
Portugal 23%
Romania 24%
Slovakia 20%
Slovenia 22%
Spain 21%
Sweden 25%
UK 20%

* 22% if the eBook does not have an ISBN.

Note that VAT rates in EU member states may change at any time depending on relevant legislation. The standard VAT rate is used for all EU countries except France and Luxembourg, which have authorised a lower electronic book VAT rate.

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