Online marketplaces already must collect VAT on sales by overseas sellers of goods held in the UK, and on imports worth £135 or less. For UK-based sellers, the seller itself accounts for VAT once turnover passes £90,000. A 2026 consultation proposed extending marketplace liability to UK sellers, and the Chancellor is reported to be considering it for the 28 October Budget, raising up to £1bn for business rates cuts.
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17 Opinions
This seems like another attack on Amazon. At the end of the day these things rarely affect the company, price hikes end up affecting the consumer.
I have voted yes with a caveat that their sellers must meet the VAT threshold.
Anything which creates extra compliance & costs for marginal benefit or sleight of hands transfer of funds from X to Y is not proper governing. Certainly the VAT threshold should be raised & then businesses can elect to be subject to its provisions if they are below the new level. There is already too much red tape.
The question isn’t clear as to whether it is all UK sellers regardless of VAT status or just those that are VAT registered. If it is only for VAT registered businesses it effectively makes no difference apart from potentially guaranteeing VAT receipts they did similar within the construction industry so contractors could not claim VAT from all suppliers and then wind up company before paying the VAT collected from customer.
One of the ways people have been making ends meet is a side hustle on Amazon or ebay. Women selling clothes, men selling tools. If you add VAT to their prices and their efforts, they will give up and claim benefits instead.
It would mean more unnecessary red tape and create cash flow problems for small businesses
Amazon should pay VAT on any direct sales. However, there are many other firms that sell via Amazon and the like. There are subject to the same VAT thresholds as everyone else. Making the marketplace pay VAT on external sellers is akin to making a physical shopping centre pay VAT on their retailers sales.
Just who do you think will be paying that VAT? I’ll give you a clue - the end consumer, you! Talk about turkeys voting for Christmas.
Yes, provided it targets VAT avoidance rather than punishing legitimate small businesses. Amazon and other marketplaces should collect tax properly owed, closing loopholes that give non-compliant sellers an unfair advantage. But don't pretend this alone saves our high streets. Abolish punitive business rates for independent retailers, tackle unfair competition and stop squeezing British enterprise. No new taxes, no unnecessary burden on small sellers. Level the playing field.
I think this works, & Amazon have stated it is simple for them. My only concern is it shouldn’t complicate the VAT returns made by UK companies. If it turns out they will be disadvantaged then no.