For the first two days of this week, the company was offering ‘Amazon Prime Day’ sale prices exclusively to members of its Prime service.
While Amazon shipping services usually deduct UK Value Added Tax of 20% from goods sold that will be shipped to Jersey residents as the Island is outside the VAT zone, subscribers found that Prime Day bargains became 20% more expensive once they entered local addresses. A new price appeared at the checkout stage that was 20% higher than would be paid by UK residents.
Local Prime members who raised the issue with Amazon customer service did not have their questions properly answered and were told removing the VAT was ‘discretionary’ and would not apply to promotions.
Shopper Rebecca Hall said she chose to leave her Amazon basket empty after receiving the response from the company.
Amazon did not respond to calls for comment from the JEP yesterday, but roughly ten hours before the Prime Day sale ended the pricing for Jersey-bound purchases seemed to right itself and advertised prices remained in place.
However, many Islanders may have already overpaid, as the change was only made 26 hours into the promotion and many residents were already complaining about the extra charges online.
The issue follows a JEP campaign launched last month urging the retailer to stop charging 20% VAT on its Amazon Prime membership fee for Jersey subscribers.
Despite a petition quickly gathering over 900 signatures, the company has failed to answer calls for the £7.99 monthly membership to be lowered to reflect Jersey’s tax position.
While Prime is a membership service, it carries UK VAT because of its provision of digital services – through its video, digital music and electronic book provisions.
The JEP is calling on more Islanders to get behind the campaign and sign our petition on change.org to increase pressure on the retailer.
Former Senator Philip Ozouf, a long-time campaigner against VAT being wrongly charged to Jersey customers by online companies, has added his support to the campaign.
‘I welcome the campaign by the JEP to raise awareness and seek a solution to what is an unfair charging practice by Amazon Prime,’ said Mr Ozouf, who brought an amendment to this year’s Budget calling on the Treasury to engage with companies still applying VAT on digital services.
‘It is important to raise these issues and that the consumer’s voice is heard.
‘That is done powerfully by this online petition on change.org that I am happy to add my name to. UK companies should not be charging VAT to Jersey consumers.’
A spokesperson for the Treasury said the engagement called for in Mr Ozouf’s Budget amendment was under way but the Island had little recourse to compel companies to comply.
‘The awareness-raising programme is continuing,’ she said. ‘This campaign concentrates on the importing of goods into
Jersey.
‘Amazon Prime offers services, which presents a more complex legal situation, as VAT is an EU tax and this limits the influence Jersey can have.
‘However, the Treasury is continuing to raise awareness with UK suppliers who charge VAT on both goods and services sent to the Island, including digital services. We are also working to ensure GST is paid where it is due.’
