The uk vat rate is back upto 17.5 percent, so everything is going to be slightly more expensive than it was.
Did it really make that much difference anyway? it made no difference to my spending habits, it was a gimmick when they lowered it and imo achieved nothing.
It's a gimmick now. Haven't you seen advertisements on TV, stating that they have 'VAT Increase Busting Prices'? Truth is, it's not an increase really, it's just the end of a period of decrease, and everyone knew it was going to go back up.
It's nothing to fret over, it's virtually nothing and most shops aren't increasing their prices and are just taking the VAT hit themselves.
But it's not a VAT hit! A fair few shops didn't decrease their prices with the VAT decrease, so they made more money. 2%-ish more, but still more money. Now it's just business as usual.
"Rant vat back to 17.5 percent" No VAT on grammar, yet Given the proposed cuts to public sector finance, and the ongoing effects of corporate budget cuts, 2010 is going to be a worse year than 2009 for retail sales. So if you have the cash, there will be plenty of discounts.
2% is nothing for most purchases. As people have already said, most people did not decrease their prices by 2% just got the extra profit themselves. Which was sort of supposed to be the idea, some places decrease prices to get more customers, others just keep the prices the same and keep the margins higher. Even though it was made out to be, it never was aimed at saving consumers money it was aimed at getting business back on its feet. The only thing I am worried about is petrol prices, grrrrrr *shakes fist*
It'll make a difference when I buy my new bike in the spring.... Not a huge amount, but a carbon seatpost/riser bar upgrade difference maybe.
Not seeing many price changes, I mean poundland is pretty much gonna remain poundland and if something is £x.99 then it's unlikely that they'll change the price due to a 2.5% VAT increase, as for the relevant computer sector... well everything atm is either dirt cheap or overpriced so who cares about the tiny percentage
Well put it this way if prices go up its an increase of about £2.50 on every £100 you spend which really is not a whole lot if you look at the grand scheme of things
It's not quite as straightforward as a 2.5% change. Original prices were 117.5% (that's the price, plus VAT), and then dropped to 115% (price plus reduced VAT). The effective reduction was 2.13%. It's still a drop in the pond for consumers, but for businesses, it may have gone some way to providing a lifeline. I don't think it was completely ineffective, but I think they could have done more. People who dropped their prices will put them back up to normal. People who didn't drop their prices have no grounds for upping them. If they do, they're being dickish. Very little will change.
Not really, because if you're a VAT registered business, you don't actually pay VAT. Even if you sell to consumers, all the VAT is paid to HMRC - so the overall effect to businesses is zero. Even the overall effect to consumers was minimal - what's a couple of quid in a hundred pounds? Most people's major expense is food, a large part of which is VAT-free, so the decrease had even less of an effect to people's food bills. It was, as has been said before, a marketing gimmick so that the government could go "Look, we're helping the credit crunch" while not really having any actual effect.
The "point" was, for simplicity's sake, let's say an item cost £117.50 in the shop - that's £100 for the value of the item, and £17.50 VAT, which would be paid to the government. Under the 15% VAT, the same item at the the same price now has £102.17 attached to its value, and £15.33 is VAT payable to HMRC. The business makes an extra £2.17, for the same product at the same price. Like I said, it's not brilliant, but a few quid here and there for a struggling business may have saved some from going under. We can't tell how many without some magic crystal ball, but we can assume it helped a little. Just, not enough for some.
That's fine if you're a retail business that decided not to change its prices after the decrease and sells products in the £100+ range - or lots of products at lower prices). What really affected those smaller retail companies was the fact that, for so long, the government kept telling us to spend less. Then, when the credit crunch happened and we did start spending less, the government tried to encourage us to spend more. Problem is, by then the damage had been done to those retail business (large and small) that were teetering on the edge of survival. Since, however, the vast majority of businesses are in the B2B arena and have little or no contact with the retail market, then the VAT change will have had no affect on them, part from helping very slightly with cash flow. The ultimate "point" is that the VAT change didn't really benefit anybody significantly, whichever way you look at it.
Lol like PC World advertising a 30 quid saving from 99.99 off there regular MS Office 2007 home price and suggesting that the vat being lower caused this saving when in reality it'd be like a £2.50 saving if it vat!
