to not get the fuss over the VAT rise

[teceral]

Its only going up by 2.5%, something that costs £10 now costs £10.21, its not a major deal. It also not on food etc. AIBU to think its much ado about nothing

Kalok and Chipping, unfortunately his skills are driving lorries, that's all he has done for the past 20 years .

I only work part time but I will see if I can get any other work elsewhere for the 4 days that I dont work atm

I know he will do his best to get other work and he will be willing to do anything but he is a bit limited to say the least!

On the bright side at least it happened after Christmas and not just before!

My dad is in the same boat MrsPresley :( All his jobs have been driving jobs, and of course they are being hit hard now

20% on everything is far too much, it doesn't affect food but it affects fuel and most other expenses that food providers have to pay which will put up food prices.

It will affect spending which is not good for the economy, don't know why they are doing this tbh!

Also it affects the poorer harder. If they really want to put taxes up there are fairer ways of doing so. I hate this bastard government, why oh why did they get voted in. I am really worried for the future atm as are many other ordinary people.

OP needs to think outside her own little world. Rant over.

It will impact on people so its not insignificant, that said our VAT is still lower than most of our competitors

Not read whole thread, so I'm sure someone will have pointed this out already, but fuel has VAT on it, and as the price of fuel goes up, the cost of everything else goes up. So although there is no VAT on food, you can guarantee the cost of food will still go up.

Here's what blows my mind about this thread:

Not the discussion of who will be most affected and whether they matter

but this kind of thing:

"it's only 2.5%, so something that cost £10 will now cost £10.21"

but the reason it is a big deal is that EVERYTHING that has vat applied that is bought by anyone in the UK at any price will rise in price by that much

the cumulative effects of that will be big and will have an impact on the economy, regardless of whether you can still afford to treat your family to fish and chips on a Friday.

How significant, and how deleterious, that impact will be is a matter for debate (and concern imo), but it is certainly not a trivial issue.

Do people make similar calculations about interest rates? Oh a piffling 2.5% rise, what harm could that do?

don't know if this has been linked to. will we see things go up fromm £1.99 to an odd number like £2.10 or will shops just go up to £2.99?

As well as fairness, there is the issue of suppressing demand - from a purely economic POV if you want to encourage spending in the economy it is best for any extra money to be with poor people (because they are more likely to spend it).

So vv it makes sense if you are taking money out of an already depressed economy to take it away from richer people (who are more likely to save).

I agree with Takver about suppressing demand and it is far from ideal, that said taxes must rise in order to deal with the deficit.

Apparently, it will cost households around £520 p/a

Anyways, the OP doesn't seem to have come back, so presumably they have realised the error of their ways.

VAT was at 15% for a year or so. Use the money you saved during that year to offset the rise this year.

Simples. :)

the thing is 2.5% increase is a bastard enough but you know shops will round up rather than down so if something will be an awkward sum with the new vat like 10.23 the shops will round it up to 10.25 and then it will slowly go up to 10.49 then 10.99. plus as other posters pointed out everything will go up further due to costs because of the new increase so it will not be a simple rise of 2.5% but more than that.

everything is going up in price but nobodies wages are, if they are lucky enough to even get a wage.

OP i hope you now understand the "fuss".

adverse camber - that would mean the average household were spending £25k pa after tax on VAT rated items.

in other words : Tosh.

a company can reclaim its VAT costs. so the additional paid by companies would not need to be passed on to the consumer.

waves at Duelling< hope you and baby ok!

True that the additional paid doesn't get passed on - but they will have to charge the additional 2.5% on their final sale price.

Of course one interesting result is that zero rated goods will become relatively cheaper. (But not exempt goods - because for those producers can't reclaim VAT on inputs.)

Is there maybe a case to reinstate a special - maybe temporary - higher rate on 'luxury goods'? (What do bankers buy? Hmm, VAT on coke? . . .)

The other things is that retailers may use this as an excuse to push up the price of goods by more than the 2.5% rise. So eg the new season stock coming in is def at least £5 more than last season, with something that was £100 now coming in at £110. I'm sure we will have the no vat increase sign to put up, but in truth, it is there plus a bit extra.

YABU - otherwise how is this going to raise £3bn per year or whatever it is ... Its not much on individual items per se, but its the cumulative impact. Look at fuel prices for cars!

If the Guardian genuine thinks that the average person spends over 2000 pounds a month on VAT rated goods they're positively insane. That would be 500 quid a week.

However the average household in the UK only spends 455 quid a week on everything.

What it looks like they've done is added the increase of 2.2% to the entire average expenditure ignoring the 25% or so of expenditure which isn't VAT rated (Mortgage, rent, council tax, lots of food, power, etc.)

Very sloppy journalism.

A more realistic number would be 340 quid from the data in www.statistics.gov.uk/StatBase/Product.asp?vlnk=361

Very interesting. A senior person of a big household name retail company told me yesterday that they are looking at an 8-9 per cent rise by the summer. Vat plus increased transport costs plus the fact that the pound is weak in Asia, costs of raw materials have increased (for clothing) and that they have effectively held prices for several years.

People seem to have forgotton that when VAT was reduced to 15% for the year it was advised that it may have to go up to 20% the following year to compensate, Labour just managed to hold off doing so until the elections.

Think it would be fairer on a sliding scale 15% on daily essentials such as petrol etc but 30% on unnecessary items such as tvs over a certain value, xboxs and showoff cars.

Just out of curiousity - I thought we didn't pay VAT on all fuel - VAT on household gas/electric is at 5% isn't it?

And the petrol increase was always going to be coming it wasn't it? I thought they didn't do VAT on that but must admit to being not quite on the ball there with baby brain on