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At least for my own country, if you buy advertising from Google, you pay 0% VAT because it's not a local purchase. With a local company there's 18% VAT. The local companies are starting the competition at a huge disadvantage.

An even playing field is a healthier market, without megacorps that can run at a loss for decades to crush out any chance competition in a field.

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In accordance to Article 44 of EU Council Directive 2006/112/EC, you're supposed to be reporting your spend with Google and paying VAT taxes on it.

You don't have to pay it right away at the time of purchase, but you do have to pay it. You might want to talk to your company's accountant...

If you do business with VAT registered company from different country, you do not pay VAT upfront with purchase, but you report it at the end of quarter (monthly if you are big enough). You will actually never pay this VAT if you are VAT registered company as you will report it and ask for refund at the same time. On the the other hand, if you are doing business with local company you pay VAT with payment for service or goods and ask for refund at the end of quarter. Long term cost is same, but it blocks your resources (paid VAT) and it may be difference for some companies.

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