Sales Tax Articles
Sales Tax State Activity Update - June 2008
U.K. Deems Ink Non-Essential Printer Component
In a customs duty case the United Kingdom Court of Appeals ruled that second and third generation Epson ink printer cartridges were not parts of printers. The Appellant in the case considered them to be part of the printer. Why does this matter? It matters because printers can be imported into the UK free of duty while ink is liable to customs duty at 6.5%.
The initial Tribunal appeal ruled that the ink cartridges were part of the printers. HMRC appealed to the High Court which found that despite the higher technical specification of the new generation ink cartridge and the fact that the printer cannot print without one; the one main characteristic of the ink cartridge was still the ink. In applying the dispensable constituent test the court looked to identify the essential component of the printer. It concluded that the printer still retained its essential characteristics without the ink cartridge despite the fact that it couldn't print on paper.
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