Norway Introduces VAT Zero Rate For Electronic News

by Ulrika Lomas, Tax-News.com, Brussels

10 March 2016

Norway introduced a zero rate of value-added tax on electronic news services from March 1, 2016.

The measure was approved by the European Free Trade Association's Surveillance Authority in January. Norway proposed the measure to bring the VAT treatment of electronic news into line with that for printed newspapers.

Approving the measure, Sven Erik Svedman, President of the Authority, said: "The new zero VAT rate makes it possible for news media, including the large number of local and regional newspapers in Norway, to publish and sell their content electronically without being disadvantaged by the VAT system "This will promote the consumption of news and current affairs media published in electronic form, which is of increasing importance for customers in Norway."

That approval came despite different policy from the European Union, which has so far blocked appeals from member states to grant equivalent treatment to the digital economy – most notably e-books vis a vis tangible books – although changes are expected.

While the Authority found that the measure provided an indirect advantage to companies selling electronic news services, it considered that that advantage would be compatible with the state aid rules of the European Economic Area (EEA) Agreement because it promoted "media pluralism and diversity" and is therefore in the common interest. The measure is valid until March 1, 2022.

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