Is VATMOSS a serious VATmess or a storm in a teacup?

I have received a number of e-mails asking me to blog on the issues or “do something”, but none from those actually engaged in running the businesses supposedly affected. More-over, all the lobbying appears to be behind closed doors. The guidance on Gov.Uk indicates  that those who are already registered for VAT and use a payment service need do very little. That from the FSB  reinforces this message.

Is it correct, however, that even micro-businesses which use the same “legal identity” for sales of on-line products and services in the UK as for overseas, will now have to register and charge VAT to their domestic customers, thus putting prices up by 20%?

If so, will this lead to halting off-shore sales, a flight off-shore or guidance from the suppliers of accounting and payment services on how to legally and cheaply split the business?
 
In other words, is this attempt to reduce VAT avoidance a serious obstacle to the UK future as a location for innovative on-line start-ups or will it simply lead to more work for tax advisors and a rash of competing “VAT apps” for teenagers (and sub-teenagers) aspiring to sell their own games instead of pirating those of others?

I have no idea – hence the question?

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