Play.com swallowed by Rakuten

Online DVD and CD seller Play.com has been flogged to Japanese web conglomerate Rakuten for £25m in cash. The transaction comes months ahead of a government clampdown on the tax loophole that the Channel Islands-based etailer had exploited over the 13 years since it was founded. This is the third acquisition that internet …

[craigj]

£25m seems a little low for a big UK online retailer

[Code Monkey]

I thought that, but considering its main competitor is Amazon and it's about to lose its tax breaks, maybe it's about right.

I used to use Play a lot until Amazon started doing free delivery.

[T.a.f.T.]

Small Beer

Changing a tax law (which in it's self must cost a fair bit to do) in order to generate £130M annually sounds like a very petty thing to do? Surly getting the MOD to buy light-bulbs from a standard wholesaler would be easier and more profitable?

[Tom Wood]

Aye, well

if it focuses the collective attention on getting a few quid extra from the likes of you and me buying CDs then we might be less likely to notice the millions that continue to be lost in much bigger tax avoidance schemes by rich folk.

[StephenD]

Changing the tax law costs virtually nothing - from the perspective of the Treasury, the ROI on such a move is vast.

£130m here, £130m there, pretty soon you're talking serious money.

I don't buy the "because someone's been profligate with public money in one area (many areas) we can therefore ignore everything else" argument. Improving procurement procedures so that we get what we need (not more and not less) for the right price is _much_ more difficult than changing the tax law.

As a play.com customer I find it hard to justify such a loophole.

[error handler]

Think like a politician.

It's not just the tax. It's the sense of fair play, of right and wrong. At the moment there's no level playing field: if you're big enough to set up a distribution centre in Jersey then you get a 20% tax break that isn't available to smaller retailers based on the mainland. This discourages small business and free enterprise, and strikes against the concept of equal opportunity for all.

OK, larger companies get advantages from economies of scale that smaller companies don't have, that's just life, but using taxpayer's cash to subsidise a few big retailers to the tune of an extra 20%? If you were George Osborne I'm sure you'd agree there are much better things on which you could spend this money.

Imagine for a moment that you're The Right Honourable $YOUR_NAME, MP, holder of the office of Lord High Treasurer, one of the Four Great Offices of State: you are Second Lord of the Treasury, the Chancellor of the Exchequer of the United Kingdom of Great Britain and Northern Ireland.

This a serious job. You sit as a personal advisor to the Queen on Her Majesty's Most Honourable Privy Council. The nation trusts you with its finances. You have sworn a solemn oath to act as a faithful and true servant. You must consider your actions carefully, and let wisdom and justice be your guides.

If you keep the MD of Play happy, your kids get a free Xbox. On the other hand, if you close this VAT loophole and spend the £130M/year with one of the big consultancy firms, you get a month in Tuscany over the summer, two weeks in the Carribean for Christmas, and when you're voted out at the next election there'll be a nice non-exec director's job waiting for you.

If you can think of a good way to frame what you're up to as some sort of principled stand against a contravention of Natural Justice (ref. my first two paragraphs) then you've got another "what a top bloke I am" chapter for your autobiography; once you've collected a few of these and a few "what bastards the other lot are" chapters you can publish for an extra bob or two.

Easy. Now let's get on with the MoD thing. Might be worth checking if any of your old University chums know anyone who runs a lightbulb-manufacturing company.

[Purlieu]

Big business chums

Another blow to the consumer, govt's action will not help reduce/retain lower prices online

[Stuart 22]

Facepalm

You pay tax - you are subsidising Play.com et al. Happy about that? You are discriminating against even more efficient UK operators.

Weird thinking.

[Thom Brown]

George Osborne tax-dodger

The chancellor of the exchequer, George Osborne, the guy who's responsible for government spending and budgets and the UK economy, himself has avoided £1.6m tax. I notice they're not doing much to close those holes. The wealthier you are, the more likely you can avoid paying tax. It's the majority of us who don't have a choice, and we can afford it the least. But then he's a Tory, so I'd be shocked if he were any other way.

[Whitter]

As I recall, perhaps poorly, the loophole as been (almost un-noticably) reduced rather than closed?

[G Murphy]

This was my, occasionally unreliable, memory too

[<spez>]

farewell n thanks

I remember the days when you had to call them to order my region 1 dvds, (dare i admit it was bugs life). ah well all good things n that.

I guess it wont be the same under new owners and the tax law change.

[Argh]

I remember the days, actually fairly recently, when I ordered a PS3 and PS3 remote, and they cancelled my PS3 due to being out of stock with no plans to restock, but still sent the PS3 remote. Very useful.

I called them, returned it, and... they sent me another PS3 remote. This happened 3 times before they finally accepted it back.

I've been happy with CDs bought from them though, except for a few crushed boxes.

[William 6]

not a 'tax avoidance'/ 'loophole' in of its self. Perhaps UK companies moving to CI specifically is exploitative.

[MagicBoy]

Play are small fry. Why close this loophole for a few online sellers and let Vodafone off £6bn in tax?

[error handler]

Because Vodafone's head of tax affairs is an old mate of Dave Hartnett, the Permanent Secretary for Tax at HMRC, whereas Play's head of tax affairs presumably isn't.

[Anonymous IV]

Hope the new owner can sort out their website techies

I can send Play.com Customer Services an email from my email address, and they can reply. Yet the website won't let me use that email address to create an account. And nobody seems to want to investigate, let alone fix, the problem!

Is it any wonder that people use Amazon?

(How nice it would be

To send Sarah Bee

Round to sort them out...)