On March 10th Ofcom ruled that the Mailmark Economy Service launched by Royal Mail at the start of this year will be exempt from VAT from 5th April 2021.
The removal of VAT on Mailmark Economy Service mailings will allow savings to be made on mail campaigns where delivery is not time sensitive. The service can also be used for Partially Addressed Mail and Direct Mail.
Mailmark Economy allows for lower priced delivery by deferring delivery of non-time sensitive mail by up to three days. The service is also available on access service mail that enters the Royal Mail network from other mail operators.
Mailmark Economy allows Royal Mail to optimise distribution of mail and in turn pass those savings on. In practice, this means that mailings posted using the Mailmark Economy service will be delivered to the recipient anytime within four days of hand over, compared to the next day delivery service offered by the Mailmark standard service. Although, 45% of Mailmark economy mailings are still being delivered the day after they have been handed over to Royal Mail.
With many businesses looking ahead to their future marketing and communications as both enter a new tax year and progress out of lockdown, the announcement of Zero VAT on this service is welcome news.
If you would like to discuss a campaign that might be suitable for Mailmark Economy, get in touch with our experts here.