Channel Islands lose LVCR High Court battle

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Channel Islands lose LVCR High Court battle

channel-islands.jpg

The Channel Islands have today lost their battle to overturn the UK government’s decision to block low value consignment relief (LVCR).

This week the UK High Court heard a judicial review of the case, which related to the islands benefitting from this VAT exemption, and ruled that the proposed changes to LVCR are compliant with EU VAT law

The UK chancellor is expected to formally announce the end of LVCR in next week’s budget.

This will mean that from April 1, it is anticipated that VAT of will be applied to all commercial consignments from the Channel Islands, regardless of value.

Mr Justice Mitting told Jersey and Guernsey they could appeal the decision to a higher court.

“I am extremely disappointed at this outcome and we will now be considering whether to lodge an appeal,” said Alan Maclean, Jersey’s Economic Development Minister. “The changes, which are targeted against the Channel Islands alone, create an uneven playing field. We know that some businesses will find it difficult to compete under these circumstances and as such, jobs are likely to be lost

LVCR was established under EU law in the 1980s to exempt low value goods purchased and imported outside the EU from VAT, to cut the administrative costs associated with collecting small amounts of the tax.

However, companies such as Amazon and HMV set up offshore mail-order operations in Jersey and Guernsey – which are not part of the EU – to exploit the VAT relief loophole.

Click here to find out how Channel Island companies will continue to take advantage of the exemption.

FURTHER READING:

Why HMV and Channel Islands’ resistance to scrapping tax relief is futile

UK TREASURY: Why the VAT relief must end

more across site & shared bottom lb ros

More from across our site

Turley will succeed the veteran Grant Wardell-Johnson on October 1
Senator Richard Colbeck told ITR he was concerned by the decision to let PwC Australia tender for government contracts again after a scandal-induced ban
Whether it be due to a fragmented advisory market or a rise in M&A, Italy’s frenetic hiring has not gone unnoticed by ITR’s Talent Tracker
The deal gives Azets 14 new partners and boosts its Swedish revenues to over $100 million; in other news, Svalner Atlas launched in Copenhagen
The tax technology company will be providing a free demonstration of its OTP software and offering best practice advice on whether to ‘buy or build’ on September 8
Johanes Glorinus Saragih of Indonesia’s Directorate General of Taxes outlines the nation’s delicate geopolitical situation, as it sits between a rock and a hard place with the US and pillar two
The law firm’s head of tax, trade and wealth management likens tax legislation to a complex puzzle, recommends a sturdy coffee mug, and explains why acronyms make tax cool
The global tax and accounting firm has appointed two experienced TP advisers from a New Jersey-based boutique
A lack of commitment from major jurisdictions and the associated compliance burden are obstacles facing the OECD initiative
Richard Gregg is no longer fit and proper to be a tax agent, said the TPB; in other news, MHA completed its acquisition of Baker Tilly South-East Europe
Gift this article