The price of digital downloads such as apps, films, music and ebooks looks set to rise next year after the Government announced changes to the way digital downloads are taxed.
Currently retailers are allowed to charge VAT at the rate set by the country their store is based in.
This rule has seen Apple and Amazon set-up home in Luxembourg which levies just 3% on ebooks and 15% on other many other downloads.
In his budget last week, Chancellor George Osborne confirmed the Government would require purchases to be taxed at the UK’s 20% rate from January 2015.
Official statistics suggest the change could be generate hundreds of millions of additional revenue for the UK Government every year.