VAT reductions not passed on to customer anymore?

[zaphoduk]

So before christmas every shop you went into passed on the 2% saving to the customer so a £9.99 product cost you something like £9.78 or thereabouts. It would seem that in the new year, this has stopped.

I've seen a poster in one clothes shop which said that all their prices had now been adjusted and no reduction will be made at the till anymore. Well this is plainly rubbish as we're paying the same for a product today as we were in November.

Has anyone else noticed this? Is there a precident for this sort of thing?

[Craig_E]

If you're talking about Next (I saw a similar sign in there last week), I think it's 'cos they've changed the prices on display. Before, they were knocking 2% off or so off the total, now the new VAT is reflected before the checkout.

[nwgarratt]

There is nothing to stop them from raising prices. If they are now selling something for £9.99 which was £9.79 before then they have raised their prices by the 2.1% instead. The VAT will still be 15%.'

Also, many places are raising prices (and online) as the £ is not strong anymore.

[jrp023]

The thing to remember here is that the VAT cut was as much to help business as it was to help the consumer, when places instantly offered to pass on the saving that was just clever promotional marketing, it also gave them a bit of time to officially change all their prices.

It still benefits the consumer even if everything does end in 99p again as with companies making more money they can afford to lower certain prices in future but i very much doubt you will see shops continue with their big VAT marketing much longer.

[Lunar Wolf]

And this is posted here why?...


There was no legislation that said businesses had to pass the saving onto the customer and the governement did actually state the VAT saving could either be used to give shoppers a saving or help businesses get a little extra income. Businesses do however have to charge the correct amount of VAT whatever they decided to do.

Before christmas most decided to pass the VAT saving on meaning if you spent £400 you saved about £10 - yay [sarcasm], now some may be deciding to keep the small bit of pocket change they were giving you to help save their hard hit businesses and hopefully keep people employed.

[Greg]

Not sure why this was posted in the blu-ray bargains forum, more of a general chat discussion, so moved here instead.