Shops not passing on VAT cut

Given that this is never going to go anywhere - after all dirtydog has held this opinion for the last 5 years and will continue to hold it for the next (Probably after I've got an actual job, moved in with the GF and omg, perhaps had something awesome like a bill from BT) - shall we just... I dunno, discuss VAT?
 
Last edited:
To the OP: If the store your talking about was a popular holiday camp quite a few years ago then i know the reason as i work there. We had a memo round all the stores basically saying that our Head Office doesn't see the point in reducing all the prices instore and online by 2.5% as this would give all staff a vast amount of hassle due to the fact of the 98,000 price changes that would occur. Also that the components that we sell would only save you a matter of pence and you would need to spend around £40 to actually save a whole £1. They are saving the VAT reduction for the next promotion that begins at the end of the month, this will make the reductions on promotional products a lot more noticeable and will therefore give the public better savings :)

On the upside im thankful, i didnt want to change thousands of price tickets today..... obviously to save the trees :)
 
Fair point - when DD starts throwing round the 'straw man' it's usually a good time to move on :D

The whole situation is bizarre, as it relies entirely on that rather irrational thing called consumer confidence, which given the average Joe's depth of understanding of the economy, is reliant on what the prevalent message is emanating from what that person considers a reliable source of information

For example, this weekend, despite the cut being minimal - shops had 'VAT cut early come buy NOW' plastered everywhere, and who knows, maybe that did influence people to buy a bit more?

The fact that it generated headlines which, generally, were on the lines of "THINGS ARE NOW CHEAPER" - who knows whether that helped instil a 'bargain' mentality and promoted shopping - is the message of more value than the actual cut itself?
 
ArchAnGeL said:
OCUK have been exemplary in passing on this cut. Not so some others.

I am talking about a high street electronic component retailer here.

I spotted a few items in ****** yesterday that I wanted to get as presents. Since ****** is usually a bit pricey I left them and checked around online last night but the price was still ok when delivery was factored in.

However, the price should have dropped today with the decrease in VAT but checking on the ****** website the final price was the same. looking into it a bit further I found the ex.vat price and this +15% is giving the same price as yesterday. Conclusion they increased the ex vat price so that when the new vat rate is added they have the same selling price as yesterday, thus pocketing the difference instead of passing it on to the customer.

I phone their sales line who confirmed that the vat decrease had been implemented today but selling prices had not changed.

It's only a small amount but the principle is important. The government is decreasing VAT to stimulate spending via lower prices in the shops. To fund this they are looking at increasing taxes later on. So basically I will be funding ****** profits via my taxes. N1!
Click to expand...

Any half wit knew that this would happen, except for our short sighted dim witted government.
 
Has it been forgotten the amount of money that these businesses raise for the economy and in fact are the larger component economy.

Fox is correct on this one and DD should stop having personal digs at him and just say something with depth or be quiet. (Not normally one to stand up for him as not needed, but do not like things to get bogged down so much).

The firms who can pass on the cut will to encourage business, those who can't will not. I would be more concerned as to what happens when/if VAT goes up and what they will do to recover that additional cost.
 
All this whining and it doesn't even matter how much the actual saving is, all that matters is peoples willingness to spend, and the hype behind this VAT saving may well be enough.
 
Dirtydog, what is "real life experience"?

Last time i checked i am paying to run 2 cars and 2 houses, yet i barely even see a bill. Bills require no attention at all, the entirety of running a household is making loads of calls when you first move in, giving them direct debit details, and letting them automatically syphon figures from a bank account.

Not exactly something which is an achievement, is it? managing to hold a bank account and having made some calls? Certainly not something which gives you any form of upper hand over someone who understands economics.
 
I run a small retail business but I wont be passing on the cut anytime soon. It helps to build the bottom line of the business and save jobs, which would you prefer to have ? 2.5% decrease or a job?

Also my costs for stock have gone up and up and guess what, they went up at the weekend... if the $ rate comes down and my costs drop, the cost of diesel drops to the level it should be based on oil price and electric/gas companys reduce their charges since the whole energy market has dropped, and the goverment stops stinging me on corp tax THEN I will drop my costs.

This week one of my suppliers has raised the price of a 120Gb laptop ide drive by £6!
 
arfur said:
I run a small retail business but I wont be passing on the cut anytime soon. It helps to build the bottom line of the business and save jobs, which would you prefer to have ? 2.5% decrease or a job?
Click to expand...

I completely support your reasons for doing that, but I bet if the local paper found out you'd be public enemy number 1. It's so ridiculous.
 
My beloved OH and I run our own small business and all of the things so far implemented by Mr. Brown have had no effect whatsoever for us.

Delay paying VAT? We don't sell much that has VAT on, so we end up reclaiming a little each quarter - so no effect

Lower NI on employees? We don't have any - so no effect

Lower VAT? As we don't have a computerised system, we would have to manually replace all the price stickers on our products, plus there have been so many price rises over the last 2 weeks, that we would have to be putting up some prices this week anyway. We can't take the VAT off at the till as it is not set up for this and we would have to pay somone about £75 to come in and reprogram the till.

From conversations with our customers, this change in VAT is having no effect at all. Our customers all say that they are waiting to see what bargains are to be had on the run up to Xmas when stores start to panic.

Besides, for anyone who has money tied up in Icelandic banks, shares or foreign finance, does any of this make much of a difference?
 
a few places dont display the vat reduced price on the price tags etc - when ou goto the till the till takes off 2.5%

Not much of a saving, but remember a lot of places still have the same prices on the items, its at the till when most do the new rate.
 
[TW]Fox;13004584 said:
I completely support your reasons for doing that, but I bet if the local paper found out you'd be public enemy number 1. It's so ridiculous.
Click to expand...

If a business is run that badly that a 2.5% VAT cut would make them have to sack people then they don't deserve to carry on trading TBH :mad:
 
uber soldat said:
If a business is run that badly that a 2.5% VAT cut would make them have to sack people then they don't deserve to carry on trding TBH :mad:
Click to expand...

I take it you have no idea about business then, in these times small firm's profit margins will be cut so thin to remain competitive that a 2.5% increase just might be enough to help them stay afloat until the economy is in a better shape.
 
uber soldat said:
If it is doing that badly then yes, cos the economy is not going to pick up next week or even next year so it will be impossible to hold on for years on the off chance things might pick up in a couple of years time
Click to expand...

who says its that bad? but look at it another way, every penny helps !

If I can increase my margins / bottom line then if one of my business customers goes bust then I dont have to worry as much about finding new revenue. Everyone sees it as a VAT cut to help the shopper, but it isnt it to help businesses as well, but you cant have it both ways !

Without small businesses there would be no economy and we'd all still be farming
 
You must log in or register to reply here.
Back
Top Bottom