Quote:
Originally Posted by derekgas
As far as prices are concerned, someone has to be paid to go round and change them all, this works out more expensive than the savings, without mentioning the raise in employers national insurance, so you are unlikely to see price reductions on everyday small to medium items, only on things like cars etc. You also have stock that was paid for at the old rate, so selling it on at the new rate will cost the middle men three pound per hundred approximately.
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You are right with prices having to be changed on individual items such as newsagents, toy shops and other retail outfits....that does cost money.
On the second part regarding VAT. The VAT paid on goods by retailers or manufacturers is claimed back from the government. The new rate has to be paid to the government.
If an item was purchased with 17.5%. and the new rate is 15% - 15% is what you would have to pay on irrespective of what VAT was claimed.