Help the Pensioners

[Benjamin]

This makes interesting reading as I think most people I've spoken to never thought the cut in VAT would particularly help the UK economy.

http://www.citywire.co.uk/personal/-/comment/retirement/content.aspx?ID=323891&re=4400&ea=161021

Sorry but it's worth cutting and pasting.

(link edited by a mod)

[AnOther]

The thing about the VAT cut is that it was a typical 'smoke and mirrors' job whereas the measures suggested in the article cost REAL money.

Quite how you place a value of 12.5bn on a measure which is founded on nothing more than a wild guess based on the nebulous potential loss of revenue from what people might or might not spend beats me. At whatever rate of VAT if people spend nothing they save nothing but neither does the government lose anything.

It was a pathetic, shallow, and ultimately futile move which cost businesses time and money, designed to do nothing more than make Moron and Darling Darling look good but more importantly give them the perfect excuse to raise VAT above 17.5% when their largess expires.

How to turn a (non) loss into a profit whilst fooling the public that they were actually the winners, classic !

[Chancer]

I am not in the Uk and dont know when the VAT reduction will come into play or if it has already.

Given that most things one buys cost £99p, £1.99, £4.99, £9.99 or even £99, if you follow my reasoning, it will be interesting to see what if any goods will have new prices that differ from that model.

If I were a betting man I know where my money would be!

Smoke, mirrors and a 2.5% kickback for all retailers and nothing at all for non VAT registered consumers.

[AnOther]

The VAT reduction came in on the Monday following the PBR the preceding Wednesday giving retailers a frantic weekend to reprice their stock.

Did you know BTW that the reason for the x.99 model is not, as many believe, to fool the shopper into thinking £4.99 is less than £5 but to ensure that a sale was rung up and the till opened for the 1p change thus preventing shop assistants from readily pocketing £5, £10, or £20 notes [;-)]

[Chancer]

No that is a new one on me but makes sense.

Did retailers actually reprice their stocks or give over the discount at the till?

Did the price of petrol and diesel drop by 2.5%?

Or are things still sold at prices like £1.99?

[Cendrillon]

"Did retailers actually reprice their stocks or give over the discount at the till?"

A lot of them say the reduction will be made at the till.

[Russethouse]

Two businesses I know didn't make any reduction - my hairdresser said as he absorbed the rise in electricity increases he was not going to alter his prices, and a relative who owns a shop said the same, plus the duty on fuel (and I think cigarettes) went up the same day

[Cendrillon]

Swings and roundabouts then[:)]

[Thibault]

[quote user="Cendrillon"]Swings and roundabouts then[:)]
[/quote]

 

No, it's actually worse for businesses which use fuel for transport etc.  Previously, they could reclaim the VAT but can't reclaim the increase in excise duty - so they have been hit with a double whammy.   And when you think how much of the stuff we buy comes by road - will the costs be passed on?  If not, the firms will have to absorb them, putting further pressure on their businesses - and possibly jobs.