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Comment by robin_reala | Hacker News Reader

Also, VAT isn’t charged for certain product categories in the EU. In the UK, for instance, children’s clothing is VAT-free.

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...and sales tax is different for different classes of product in the US, with some things getting better treatment, such as groceries, and some things worse, such as car tires. I did not expect it to be relevant to this specific case, but yes: I guess children's clothing is an interesting one for this Regretsy charity drive; that said, they stated "toys", not "clothing", and I don't remember toys being on that exemption list (which I actually have read, as I needed to see if any of the things I was selling had different rates).

(PS: the coolest one I've seen is that bound physical books often have much better tax rates than other goods, leading to hilarious situations where shipping someone a physical pamphlet that includes base64 might be much cheaper than selling them an expensive piece of software on CD. ;P)

As an aside, the company that makes Jaffa Cakes, a popular biscuit in the UK, went to court to get their biscuits counted as cakes. Cheaper VAT. http://en.wikipedia.org/wiki/Jaffa_Cakes#Cake_or_biscuit.3F

This varies by tax jurisdiction. For a while in Washington State, snickers bars were taxed as candy but Twix were tax-free because they were "groceries"....

Technically, it is not VAT Free. It's rather that the rate of VAT is 0%.

Effectively the same I know...

Not the same. Business that sell VAT 0% items (zero-rated items) can still deduct VAT on supplies, whilst providers of VAT exempt goods can't claim back VAT on supplies.

For example, admission to a charitable event is VAT exempt in the UK, while goods sold at a charity shop are zero-rated.

http://www.hmrc.gov.uk/vat/forms-rates/rates/goods-services....

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