#VATMOSS A Threat to all WAHMs?

VatMicrobusinesses, including many work at home mums and dads, have taken to social media to protest against new VAT laws which may compromise their ability to trade with Europe. The changes are quite specific but could affect thousands of small businesses and sole traders across the UK. Many small businesses are ready to fight and today has been a day of protest.

From January 1st 2015 EU VAT will be charged in the country where products are bought, not the country where they are sold. More specifically this change is only on digital products which can cover everything from eBooks to online courses to music downloads. The rates of VAT across Europe vary massively and this is where the problem comes from. The rate of VAT in Italy is very different from the rates in the UK and the same applies across many other European nations.

The government’s way round these differing VAT rates is to introduce their VAT Mini One Stop Shop Scheme, known as VAT MOSS. Through signing up, business owners will then be required to submit what they call a single calendar quarterly return and make a VAT payment based on this to the HMRC. In reality it means comprehensively recording the exact location of every client who has bought a digital item and it means small businesses are forfeiting their former right to exemption from VAT, for the sake of expanding their business into Europe.

Many microbusinesses, from those who sell knitting patterns online to audio mp3s, have seen this as a sign that they can no longer sell their goods to Europe and are therefore shutting down operations beyond the UK. How this can be in the interest of the UK economy and small business sector is anybody’s guess but whilst some are resigned to closure, there has been a huge boost thanks to a huge and far-reaching digital protest. The Twitterstorm, organised by Lorraine @DIYbeautydiva has trended in the UK and the tweets just won’t stop coming:

It’s clear the UK microbusiness sector won’t take this lying down and a petition to government is fast approaching its 5000 necessary signatures to be considered and taken to Downing St.  The administrative burden and potential financial loss for the many small businesses in the UK is huge and so far, it is hard to see how VAT MOSS can be beneficial to the UK business community. Many of the WAHMs and WAHDs who use and connect through WAHMWeb may be affected come January and more than this, people considering moving into self-employment may be dissuaded. The internet has made trading and doing business with Europe and beyond is something that couldn’t have happened anywhere near as easily before. Limiting small businesses and forcing them to follow the same rules as Amazon, whilst also giving them even more administrative work to do, is going to lead to even more small businesses not making it beyond their first year, if they get off the ground at all.

Sign the petition, send a tweet and be part of the storm!