By Ben King, 15 November 2001 14:57
NEWS French-owned ISP Freeserve has threatened to sue the government over the tax loophole that means it has to charge VAT while rival AOL pays none. Because AOL is based outside the EU, it does not have to charge its customers VAT, saving an estimated £30m a year. The increasing importance of unmetered internet access products makes the situation even more serious, Freeserve claims. The company has written to customs minister Paul Boateng, threatening to take the government to court to recover damages if the situation is not remedied soon. The letter warns: "In the event that the position is allowed to drag on much further, we will have no option but to pursue a remedy against the UK Government before the European Commission."
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