Rivals of Royal Mail have long called for the exemption to be removed, citing it as an advantage for its position in the mailing market, reports Hell Mail.
And if Deutsche Post was no longer exempt from VAT, the mail operator could call on the government to treat Royal Mail, the company it was once rumoured to be buying into, by the same rules.
Last month, Royal Mail was informed by HM Revenue & Customs that it would have to charge VAT on the majority of the business deals it tenders for, following a European Court of Justice ruling.
However, Mailsort 1, 2 and 3, which are used for the Royal Mail's direct mail offering, are not subject to the HMRC ruling as they are price controlled.
Royal Mail rival Deutsche Post no longer VAT exempt in Germany
Royal Mail rival Deutsche Post will soon no longer be exempt from VAT in Germany, it has been announced - a move that could see it lobby the UK government to apply the same rules to its mail business in the UK.
