Sky wins ECJ case to exempt PVRs from tax

The European Court of Justice has agreed with British Sky Broadcasting and overturned the UK tax authority’s classification of a PVR and, thereby, exempted it from import duty.

The Inland Revenue had classified PVRs as recording devices subject to 13.9 per cent import duty (virtually all PVRs are made in China). However, the ECJ in answering Sky’s appeal of the ruling states “…decoders with a hard disk drive, such as the Sky+ box, are to be classified as set-top boxes with a communication function rather than as recording devices.

In that connection, the Court points out that, in the case of electrical devices, machines that have several functions and could be classified in different categories are to be classified according to the principal function of the device….consumers subscribe to service-providers such as Sky principally to be able to access the television programmes offered and, in order to do so, they need a box such as the Sky+ box. The television programme recording function, which is also available on that model, is merely an additional service.”

Several other EU states, including France, classify PVRs as recording devices and subject them to duty. In some cases this has lead to some byzantine descriptions of what a (PVR) device is or does in order to escape additional tax.

You must be logged in to post a comment Login