AOL choses Luxembourg for VAT base
AOL Europe has confirmed that it will launch a new business unit in Luxembourg in order to comply with EU tax legislation.
Link: New CFO at AOL Europe
The move will result in the ISP paying VAT in the UK for the first time, and is a coup for rival, Freeserve, after a long-running legal battle between the two internet giants.
Gordon Brown adopted new EU internet regulations which will come into play on 1 July. They stipulate that ISPs operating in Europe must abide by the tax laws in each European country.
A spokesperson for AOL said the company had chosen Luxembourg because of its low VAT rate, and because it already has an office there.