VAT loophole: Treasury ends rules allowing VAT avoidance

The government is changing the tax rules that have allowed retailers to avoid paying VAT, by sending goods from Jersey and Guernsey.

Low Value Consignment Relief applies to goods worth less than £15, putting about 1700 jobs at risk.

Richard Allen from Retailers Against VAT Avoidance Schemes welcomes the change and says with certain sectors being VAT-free, there is no point in competing in DVD sales online unless you are based off-shore.