Posted: 02nd May, 2003 By: MarkJ
AOL UK is expected to start paying value added tax (V.A.T), albeit indirectly via a new centralised European company, from 1st July 2003:
The UK ISP intends to absorb the tax hike and has no plans - at the moment at least - to pass on the charge to its UK customers.
The move follows a decision by AOL to set up a new company - AOL Europe Services SARL - in Luxembourg that will provide all of AOL's services in Europe.
Under the new set-up, all of AOL's European customers will be billed by the Luxembourg operation. As a result the company will be able to charge a single rate of VAT across all of its country operations, instead of charging different rates of VAT based on each individual country's tax laws.
It's worth noting that AOLs move will coincide with the introduction of new European tax legislation, more @ the Register.