Shops not passing on VAT cut

[RDM]

Well, most of our salaries go into VATable products. Average household income of non-scrooging, mortgage paying family in UK is £52,400 per annum. Over 60% of which is spent outside mortgage and savings. Which means that unless we presume majority use black market and grey import for their weekly shopping, most of us in UK will save between 700-800 pounds a year on 2.5% lower VAT as a rough estimation. Thanks for little mercies, maybe, but I'm sure as hell not going to leave that kind of money behind on a counter.

Your maths is out. Even if the entire 60% was spent on VAT rated products it would equate to £670. This is of course if you didn't spend any of your outgoings on:

Petrol (will cost slightly more now as the VAT cut doesn't cover the duty increase).
Gas and Electricity (Not charged at 17.5%)
Non Luxury food (which is most staples)
Alcohol (Duty increase, again probably more than the VAT cut.)
Childrens Clothes (VAT free)

So it isn't going to help even the reasonably OK family on £52k a year. It will do bugger all for those on much less.

It is a con, a feelgood measure that will literally do nothing for families. It may help some small business but only if they don't pass on the cut and therefore get lambasted for "keeping our money" instead.

Unfortunately it seems that people are actually falling for the spin and thinking it is a really good idea.

 

[Hxc]

Who cares? You'd rather it be £4.99 & £3.49? How can a lower price be horrid?

Its WIN/WIN for consumers!

I hated the job of explaining to tonnes of customers why the prices on our system were different to the ones on the tickets.

My collegues who worked on sunday also hated spending the entire day reprinting and replacing every single ticket in the store.

It's messed up our change slightly as well, we get through significantly more coins than we usually do, we ran out of 10ps on saturday

 

[titchard]

I'm worried. I am agreeing with TWFox!

He is the only one speaking a deal of sense in this thread at the moment with some clear reasoning.

Rich

 

[Hxc]

That would be because he studies economics and actually understands things, rather than the "armchair experts" here

 

[G-MAN2004]

Its WIN/WIN for consumers!

Yeah, until they give us a tax increase to pay for it.

 

[LiE]

That would be because he studies economics and actually understands things, rather than the "armchair experts" here

I think what he is applying here is common-sense.

 

[howthe]

Only if you spend £10,000 on VAT rated products over the course of a year.

You are missing something in your calculations. A 2.5% cut in VAT does not equal a 2.5% reduction in the overall price it actually equates to a 2.13% reduction in the overall price.

I will actually be spending a small fortune this coming year so like I said, every penny counts to me.

And thanks for explaining the price reduction

 

[dirtydog]

That would be because he studies economics and actually understands things, rather than the "armchair experts" here

No, he is the armchair expert. He is like the person telling you what it is like to drive a car when he has never sat in the driving seat before. I wouldn't value his opinion over someone who has been driving for years.

 

[Squink]

That would be because he studies economics and actually understands things, rather than the "armchair experts" here

Unlike the Chancellor and his panel of economic experts who just guessed that a VAT cut would help

 

[PinkFloyd]

I can't believe all the people in this thread whining that things are being lowered in price, namely those using the "I'd rather have 1p change" members....

Do you go into shops and just buy a single thing at a time?

*Oh look today I need to by 4 things. Oh looks I'm going to have 4x73p of change*

Over the space of a week, if your including food shopping and all it will not be a pot of loose change like some people are making it out to be. Granted it isn't going to be a small fortune, but its a bit of extra spending money for the pub or something to put towards a game or similar.

 

[Hyper]

I know IKEA are also lowering prices by 2.5% from today,

All the price tags are going to take ages to change though!

 

[Jambo]

No, he is the armchair expert. He is like the person telling you what it is like to drive a car when he has never sat in the driving seat before. I wouldn't value his opinion over someone who has been driving for years.

What is your opinion backed by?

 

[Muffin`]

No, he is the armchair expert. He is like the person telling you what it is like to drive a car when he has never sat in the driving seat before. I wouldn't value his opinion over someone who has been driving for years.

You're coming across as a bit of a see you next Tuesday sort of fellow, can I suggest a nice warm cup of STFU.

 

[dirtydog]

What is your opinion backed by?

Experience of life. Also I know something about economics.

 

[dirtydog]

You're coming across as a bit of a see you next Tuesday sort of fellow, can I suggest a nice warm cup of STFU.

I think you and Fox need to get a room

 

[Jambo]

Experience of life. Also I know something about economics.

So shops should pass on the VAT cut because you don't have enough money? What if the shops don't have enough money? Shops not passing on the VAT cut might allow them to survive and/or avoid people losing jobs. I don't see how you can **** off Fox if you are just basing your opinion on the fact that you have bills to pay. That's not exactly an unbiased position.

 

[Muffin`]

I think you and Fox need to get a room

It could be anyone and I'd tell you the same, I think your attacks would be better aimed at Killa_Ken and his silver spoon, with him dressing it up as him earning it all.

 

[LiE]

Point is, if you're fussing over making small savings, then you should probably reconsider shelling out for the goods in the first place.

 

[dirtydog]

So shops should pass on the VAT cut because you don't have enough money? What if the shops don't have enough money? Shops not passing on the VAT cut might allow them to survive and/or avoid people losing jobs. I don't see how you can **** off Fox if you are just basing your opinion on the fact that you have bills to pay. That's not exactly an unbiased position.

Me? I have plenty of money thanks

I don't mind whether shops pass on the VAT cut, or save it for themselves - either way it benefits the country which is what I care about. I said this earlier in the thread.

 

[Jambo]

Me? I have plenty of money thanks

I don't mind whether shops pass on the VAT cut, or save it for themselves - either way it benefits the country which is what I care about. I said this earlier in the thread.

Oh sorry I thought you were disagreeing with Fox. I didn't realise you were just taking an opportunity to have a go at him.