Tesco Goes Offshore To Cut DVD Prices

UK Supermarket giant Tesco has cut the price of CDs and DVDs by setting up a distribution arm in Jersey. The company is able to sell chart CDs from £8.99 and DVDs from £9.99, including postage and packing, by taking advantage of the island’s VAT rules.

Jersey does not charge VAT on goods sold in the island. These can then be shipped to the UK under regulations that mean items under £18 are exempt from import duty.

The restriction means only single CDs and DVDs, rather than batches, can be ordered while still avoiding VAT.

The Tesco Jersey service is only available through the supermarket’s online business.

The company said it was merely following other companies which had set up in Jersey for the same reason.

John Paul O’Reilly, director of Tesco.com, said: “Tesco Jersey offers shoppers more choice. Shoppers can now choose to pay less for chart CDs and DVDs through Tesco Jersey or still buy goods from our existing home entertainment channel through Tesco Extra online.

“The service allows us to cut prices and pass on even more savings on to customers and we think it will be really popular in the run-up to Christmas.

“Many other online retailers such as Amazon already run operations out of Jersey so we developed our site to make sure Tesco.com shoppers weren’t losing out.”

Story source: scotsman.com.