Saturday’s Guardian reports that HMV and Woolworths are exploiting a VAT loophole to bring goods valued under £18 to be imported via UK Stores.

Dedicated kiosks appearing in UK stores are allowing punters to purchase from abroad, VAT free, provided the total value does not exceed £18. The freedom to do so could mean cheaper games for those people who don’t mind waiting a few days for the product’s arrival from Guernsey in the Channel Islands.

According to the Guardian, Woolworths already has 40 such ordering kiosks in UK stores. HMV is rolling out a similar service rolling over the next couple of years, but already benefits from VAT-free sales online.

The Guardian report finds that the Treasury looses £8.75 million a year to this loophole. However HMV says the total VAT lost from HMV Delivers would’ve only been around £140,000. An HMV spokesperson told industry magazine In Stock that its 'HMV Delivers' service: “currently enables customers to place an order at the sales counter for a title that may be out of stock direct from our Internet fulfilment centre. We provide this as a service to our customers, and it represents a negligible part of our overall sales."

Ultimately HMV says that its kiosks are intended for digital media downloads such as MP3s. Meanwhile, savvy customers after videogame bargains are of course free to browse any number of online retailers anywhere in the world to find software at lower prices. You’ll need to pay the P&P, but still the savings are often significant. It would appear that Woollies and HMV are just providing a convenient service here.