EU Court Rules Ebooks Are Services, Not Goods. No Reduced VAT Rate

France and Luxembourg lost their battle to apply reduced VAT rates to ebooks on Thursday when a top European court agreed with EU regulators that only paper books qualified for lower taxes. EU rules allow member states to set lower rates of value-added tax on printed books but the European Commission decided two years ago that the 5.5 percent and 3 percent rates imposed by France and Luxembourg respectively, were illegal.