Multifunction Devices may start attracting extra tax Dec 15, 2008 15:33 by John Sollars
Over the past few years printer manufacturers have moved into making their devices more and more all purpose, with all of the major manufacturers offering Printer/Scanner/Copier and some with built in fax capability as well. Up until recently this was purely innovation by the printer manufacturers hoping to attract consumers to a single device which takes up less desktop space and is much more economical.
However the EU, in its infinite wisdom has been reviewing this shift in the market. Twelve years ago the world’s biggest trading partners agreed that in order to boost the global economy, they would apply zero import duties on all computer-related equipment. This was called the Information Technology Agreement (ITA). Now tax officials in the EU have started to question whether the zero-duty ITA is being stretched beyond its original intended purpose and have reclassified many devices, including printer/scanner/copiers, LCD screens and TV Set top boxes that contain a hard drive as products that should be liable for import duties ranging from 3 to 14 percent.
As you can imagine, manufacturers are up in arms about the reclassification of their wares, and are fighting with every weapon in their arsenals. Printer manufacture HP took their grievance to the European Court of Justice in Luxembourg, which has just released a complicated judgement advising national courts in the EU to consider a multifunction machine according to its main feature. If this is printing or scanning, then the machine should not incur any import duties, because these functions are dependent on being connected to a computer. If however copying is the main function or all three functions are equally important, then courts should count the machine as a copier and apply 6 per cent duty.
We will wait in eager anticipation to see how HP, Canon, Epson, Brother and Lexmark react to this ruling, but you can bet your life that copying will be downgraded as a function in your forthcoming Multi-Function device!