{summary}The VAT treatment of insurance mediation over the Internet is caught between the principle that VAT exemptions must be interpreted strictly and the circumstance that the EU legislature has not been able to keep up with the rapid developments in the market for specific services. In this article, the author compares the scope of the exemption for online insurance mediation in Germany and in the United Kingdom and concludes that the EU legislature should act quickly to restore a level playing field for service providers operating through the Internet.