European Union finance ministers have agreed a proposal allowing member states to reduce VAT rates on electronic publications, bringing them in line with tax rules on print.

In the UK, printed newspapers, journals and magazines are zero-rated for value-added tax. However, digital versions of these publications are currently subject to standard-rate VAT of 20 per cent.

The new ruling from the Economic and Financial Affairs Council permits “super-reduced” VAT rates (below 5 per cent) or zero rates in countries where this is already applied to printed publications.