Travellers are set to face increasing phone bills when using their mobile phones abroad

20 March 2017

In the Spring Budget 2017, the government announced that it will remove the VAT use and enjoyment provision for mobile phone services provided to consumers. This will bring UK VAT rules in line with the internationally agreed approach. The measure will bring those services used outside the EU within the scope of UK VAT.

The implications of this will mean that when you use your mobile phone abroad, those calls and internet charges will be subject to UK VAT whereas at the moment they are not, meaning mobile phone roaming bills will rise by 20 percent. At present, mobile users are charged VAT when they use their mobile phone within the EU’s 28 member states, but not when they roam in countries like the US or Australia.

High roaming charges already mean that holidaymakers can pay hundreds of pounds for services that they would get for as part of their mobile phone package at home.

The cost of roaming across the EU is set to be abolished entirely from June, although it has been confirmed that the UK will not benefit from the regulations when it leaves the EU unless it forms part of negotiations for a settlement

If you have any questions about these upcoming VAT changes, please do not hesitate to contact me or your nearest UHY expert for some advice.