They are changing a law that was created in 1984
When no one was buying CDs from the internet.
( tangledupinblue hairy badge with moving eyes, Mon 2 Apr 2012, 13:25, 1 reply, 13 years ago)

It doesn't apply just to CDs it is anything that was worth less than £15 or something like that.
Given that buying CDs is not a new idea letting it go on for this many years is just incompetence on their part.
(Bazongaloid, Mon 2 Apr 2012, 13:26, Reply)

From what I gleaned from half listening to the radio in the car this morning
It was initially created to enable Channel Island companies to sell items such as cut flowers on the mainland where the end user was likely to incur costs in collecting them. Removing the VAT balanced out this extra cost and allowed them to remain competetive.
Yes it was incompetent for previous governments to allow this to continue past it's relevance and allow companies to exploit the loophole by setting up subsidiaries in the Channel Islands. But New Labour at the time were a) experimenting with the Tory tactic of getting into bed with big business to try to remain in power; and b) too busy starting wars all over the place to bother about tax loopholes.
( tangledupinblue hairy badge with moving eyes, Mon 2 Apr 2012, 13:35, Reply)