Amazon is cutting the price of ebooks in the Kindle store for UK customers due to VAT changes quickly rolled out in light of the COVID-19 pandemic.
The UK Treasury's plans to bring paid-for digital publications, including newspapers and books, in line with traditional, printed media -- of which no Value Added Tax (VAT) is imposed -- has been fast-tracked and introduced seven months ahead of schedule.
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The government said the reduction of VAT from 20% to zero reflects the uptake of digital media prompted by the lockdown. According to Chancellor Rishi Sunak, this could reduce not just the cost of standalone ebooks, but also the annual cost of media subscriptions including magazines and newspapers.
As reported by The Guardian, Amazon's ebook changes will be introduced on Friday. If an ebook used to cost £15 including VAT, for example, the cost would now be £12.50.
"We want to make it as easy as possible for people across the UK to get hold of the books they want whilst they're staying at home and saving lives," Sunak said. "That is why we have fast-tracked plans to scrap VAT on all e-publications, which will make it cheaper for publishers to sell their books, magazines, and newspapers."
Customers should see the changes in pricing today.
An Amazon spokesperson said the company is "working as fast as possible to lower prices for customers."
A survey conducted by the Office for National Statistics, updated on April 30, says that 81.7% of UK adults are "very worried" or "somewhat worried" about the effect that COVID-19 is having on their lives.
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In total, 42.1% of adults said reading is helping them cope with the lockdown and social isolation. Gardening, staying in touch with family and friends remotely, using content streaming services, and exercising are also popular activities.
The government is also planning to spend £35 million with regional and local newspapers over the next three months for advertising purposes to help publications shore up their finances while the pandemic still requires severe lockdown measures.
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Amazon's Q1 2020 financial results revealed a net income of $2.5 billion, in comparison to $3.6 billion in the first quarter of 2019. The e-commerce giant expects to pay billions of dollars in costs related to the pandemic. This week, Amazon CEO Jeff Bezos told investors to "take a seat" and to expect financial losses to continue into the second quarter.
Approximately $300 million has also been earmarked the expansion of the firm's own COVID-19 testing capabilities.
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