Steam prices may rise in 2015

Tax loophole to close, and with it the potential for increased prices.
Text: Mike Holmes
Published 2014-03-25

There's a very real chance that Steam prices may be set to rise next year, when a loophole involving VAT is set to be closed.

As reported by Develop, as it currently stands, Steam currently sells to the European market through their Luxembourg office, a country that allows companies to charge a rate of 15% VAT (with that figure set to rise to 17% next year).

UK gamers have been enjoying this lower VAT rate for a while now, but the loophole is due to close when legalisation is pushed through that'll see that services are taxed where the consumer is located, not where the business is. That means the UK's VAT rate of 20% is likely to be applied to all purchases.

According to Harbottle and Lewis lawyer Nic Murfett this leaves Valve with a couple of options: they "either start distinguishing the VAT that is payable on each purchase from the retail price of that purchase (as the amount of VAT will vary depending on the Member State in which the consumer is located) or raise the price of all of its games across the EU in order to account for its increased VAT liability."

It's not just Valve that will be impacted by this shift, with Apple customers using the App Store also likely to be inline for a similar price hike.

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