Changes Related to Value-Added Tax for Postal Services

Effective January 2011!

In Austria, addressed postal items have traditionally been exempt from value-added tax. However, due to a decision by the European Court of Justice (ECJ; C-357/07 dated 23 April 2009), major changes to the fiscal treatment of these postal items will become effective:

New legislation requires Austrian Post to charge value-added tax for products that do not fall under the scope of universal services, effective January 2011, and to pay this tax to the tax authorities.

As a consequence, as of 1 January 2011, only services defined as universal services will be exempt from value-added tax. The scope of universal services is defined in the new Postal Services Act (also effective 1 January 2011).

The following postal services are part of universal services and will therefore remain tax-free, provided that they are posted at postal service locations (postal branches, Post Partners) or deposited in mail boxes in accordance with our General Terms and Conditions:

Postal items weighing up to 2 kg (LETTER MAIL, INFO.MAIL)
Dailies, weekly newspapers and monthly magazines ¹⁾
Parcels weighing up to 10 kg (except EMS)

_{1) Also applies to items posted at distribution centres.}

Letter Mail and Advertising Mail

	EXEMPT FROM VAT	SUBJECT TO VAT
DOMESTIC LETTER MAIL INFO MAIL	Items shipped as defined in our General Terms and Conditions (GTC; no individual agreements) and posted at an Austrian Post service store (e.g. postal branches and Post Partners). NEW: bulk discount as defined in our GTC	Items shipped in accordance with individual agreements 1) and/or when delivered to distribution centres. INFO MAIL 2) returns are always subject to VAT; additional copies (surcharge for not meeting the minimum amount) shall, for tax purposes, be treated as the main service provided.
INTERNATIONAL LETTER MAIL – new zones INTERNATIONAL LETTER MAIL, INTERNATIONAL LETTER MAIL PLUS and M-BAG: zone 1 EU, zone 2 other countries in Europe, Zone 3 rest of the world. MULTI LETTER INTERNATIONAL: zone 1 EU, zone 2 other countries in Europe 1, zone 3 other countries in Europe 2, zone 4 rest of the world.	- Items shipped as INTERNATIONAL LETTER MAIL (PLUS) as defined in our General Terms and Conditions (GTC; no individual agreements) and posted at Austrian Post service stores; applies to all zones. - Items shipped as M-BAG INTERNATIONAL, INTERNATIONAL BUSINESS LETTER MAIL and MULTI.BRIEF INTERNATIONAL to non-EU countries	- Items shipped as INTERNATIONAL LETTER MAIL (PLUS) in accordance with individual agreements1) and/or when delivered to distribution centres. - M-BAG INTERNATIONAL, BUSINESS.LETTER INTERNATIONAL and MULTI.BRIEF INTERNATIONAL, shipped to zone 1 EU, respectively - GERMANY. BUSINESS
INTERNATIONAL ADVERTISING MAIL: EURO.MAIL INTERNATIONAL DIRECT MAIL (IDM)	EURO.MAIL and INTERNATIONAL DIRECT MAIL (IDM) are partially subject to value-added tax if mailed by Austrian clients: • Country of destination = EU: subject to VAT • Country of destination = non-EU country: exempt from VAT
ADDITIONAL SERVICES AND OTHER SERVICES	The tax treatment of additional services is analogous to the main service: Registered mail, insured letter, cash-on-delivery, Track&Trace national, deliver to addressee only, advice of receipt and do not deliver to authorized agents.
ADDITIONAL SERVICES AND OTHER SERVICES	Literature for the blind; official letters (RSa, RSb) – also applies to items posted at distribution centres.	Domestic: PO box, vacation hold mail franking service, Collect Post, redirections 3), authorization to receive mail, reply mail, track & trace, poste restante, Ident.Letter, collection service4) International: poste restante, collection of bills, track & trace, customs processing, International Express Letter

_{1) Agreements regarding deferred payments/collective invoices shall not be regarded as individual agreements.
2) NEW: returns of INFO.MAIL, SPONSORING.POST, COMPANY NEWSPAPER, MONTHLY MAGAZINES discount rate : the option of choosing between return and non-return items and the labelling will stay in place. To streamline the process, the fee (1 cent per item posted) will be charged in advance upon posting, effective 1 January 2011.
3) Redirections to non-EU countries are exempt from VAT.
4) Only possible in combination with “postage paid”.}

Parcels

	EXEMPT FROM VAT	SUBJECT TO VAT
DOMESTIC PARCEL INTERNATIONAL PARCEL	Domestic parcel and International Outbound weighing up to 10 kg if posted at an Austrian Post service location (e.g. postal branches and Post Partners). Weight categories will be adapted accordingly.	Domestic parcel exceeding 10 kg and international parcels exceeding 10 kg, shipped to EU countries or parcels shipped according to individual agreements and/or delivered to distribution centres.
	Domestic parcels: • Small parcels • Return parcels • Gift parcels • Wine parcels • Pickup parcels • Premium select • Domestic Premium Parcel • OMV Parcel Service • Domestic Combifreight • Parcel stamp • Logistics services
International parcels • International Outbound parcels up to 10 kg if posted at an Austrian Post service location. • Shipment of international parcels to non-EU countries is always exempt from VAT regardless of their weight.	International parcels • International Outbound parcels exceeding 10 kg sent to EU countries or sent in accordance with individual agreement and/or delivered to a distribution centre. • Consignment Outbound • Premium International Outbound • Combifreight Outbound (sent to EU countries)
ADDITIONAL SERVICES AND OTHER SERVICES	The tax treatment of additional services is analogous to the main service:
		Exceptions: • Large bulky items • Fragile items • Hazardous goods shipment (limited amounts) • New product available at Austrian Post service stores: "sensitive" 1) • Charge recipient • Return item (domestic and international) • Customs clearance fee • Redirections

Business Services

	EXEMPT FROM VAT	SUBJECT TO VAT
DELIVERY / PICK-UP MAIL ROOM MANAGEMENT1)		Subject to VAT because these services are based on individual agreements. Please note that the logistics services provided by our Mail Room Management will now be subject to VAT as well.

Medienpost

EMS

EXEMPT FROM VAT SUBJECT TO VAT

EMS EMS International to non-EU countries
All services

• Domestic EMS
• International EMS to EU countries

	EXEMPT FROM VAT	SUBJECT TO VAT
DAILIES/ WEEKLY NEWSPAPERS and MONTHLY MAGAZINES	Dailies, weekly newspapers and monthly magazines are exempt from VAT as defined in our GTC, even if delivered to distribution centres. In this case, this treatment is not regarded as an "individual agreement".	Dailies, weekly newspapers and monthly magazines posted on the basis of individual agreements.1)
COMPANY MAGAZINES PLUS.NEWSPAPER SPONSORING.POST		These postal items are subject to VAT.
NEW: Return items 1) are always subject to VAT, which will be charged at the time of posting.

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Changes Related to Value-Added Tax for Postal Services

Effective January 2011!

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