Taxing Changes

In the US shops generally show prices without sales tax and the extra is added to the price at the till. In the UK, however prices are shown inclusive of tax. This has caused problems with the change of VAT (Value Added Tax) from 17.5% to 15%. The change was announced a week before it took effect, offering little time for stores to change notices. There seem to have been several ways of dealing with this.

Several shops have said that they will take the tax off at the till, so the prices you see on the shelves are higher than what you actually pay. Other shops are altering prices, but have not yet completed the exercise, so you may pay the quoted price or maybe a little less.

We had lunch at a restaurant today which had an announcement slip in each menu that they had previously planned to raise prices by 5% on December 1st, but in view of the fall in VAT have left the prices alone. This seems an awfully helpful coincidence that saves them reprinting their menu.

The third option was at Costa Coffee, where they announced that all prices were 5p less than the posted price. For the medium sized Cappucino that we ordered this was the correct change dictated by the rate reduction. However, for larger drinks they are short changing their customers.

Online it has obviously been easier to update prices, but all of a sudden you see items at 8.80 rather than 8.99.

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Published in: on 3 December, 2008 at 9:50  Leave a Comment  

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