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VAT increases to 20% in January

Discuss (sorry if this is elsewhere!)
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Comments

  • Probably best in the long term
  • i was expecting it to be worse
  • We're sick...unforunately we have to take some medicine as horrible as it may taste.
  • Somthing's got to be done. To be honest, I didn't notice the difference when it went down by 2.5%.
  • [quote][cite]Posted By: DaveMehmet[/cite]Somthing's got to be done. To be honest, I didn't notice the difference when it went down by 2.5%.[/quote]

    No and a lot when it first went up swallowed the increase of course over time the increases krept in, im sure a lot of shops will do the same this time round
  • No mention of exemptions in his speech.

    Problems have largely grown out of the banking crisis, yet we are all expected to bear the burden.

    Without going into the finite detail for me this budget means.... no prospect of a pay rise for 3 years, a huge increase in my pension contributions, bye bye tax credit, bye bye any rise in child benefit, no idea what my departmental budget will be till October 22nd, expectation that I will deliver the same service with a reduced budget and smaller team. I'll pay out more in various duty increases and watch on powerless whilst we "honour our overseas aid commitments".
  • Listined to the budget on the radio on way to work, hard to imagine that one family in this country are given 140k a year housing benifit! How did they get away with that. As much as I hated the thought of this mickey mouse government they actually seem to be doing ok. No increse on fags and booze too so that's good. To be honest I don't think we will even notice the increase apart from when using mechanics builders sparky's ect.. 4 years of 20% will bring billions into the kitty.
  • [cite]Posted By: adamtheaddick[/cite]Listined to the budget on the radio on way to work, hard to imagine that one family in this country are given 140k a year housing benifit! How did they get away with that. As much as I hated the thought of this mickey mouse government they actually seem to be doing ok. No increse on fags and booze too so that's good. To be honest I don't think we will even notice the increase apart from when using mechanics builders sparky's ect.. 4 years of 20% will bring billions into the kitty.

    and all those extra billions will vanish into ring fenced budgets. He makes no mention of how we will be paying for these protected funds.
  • VAT is regressive but it does to some extent hit discretionary spending because food, childrens clothes and books are zero rated. Economists have been arguing for years about this. (I remember at college in the 1970s).

    An increase in child tax credit will benefit those and the bottom of the income scale.

    Frankly none of the parties ruled out VAT increases in the pre election mantras. Of course they all said they didn't have any plans but twas ever this. Slightly miffed at Harriet Harman and her Labour colleagues for pretending that they had not produced a record deficit or had not ruled out a VAT increase. Ed Balls has just accused Darling of ruining Labours election chances by not ruling it out.
  • So what does this put on a season ticket as it is being introduced half the way through the season!, or will the club absorb the increase ( just asking!)

    Amazing that the banks have got away with it...... seems everyone is to pay except the banks!
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  • [cite]Posted By: ken from bexley[/cite]So what does this put on a season ticket as it is being introduced half the way through the season!, or will the club absorb the increase ( just asking!)

    Amazing that the banks have got away with it...... seems everyone is to pay except the banks!

    club have already said they will pass on the cost. So assume half year STs will increase by 2.5%.
  • They will not absorb the increase
  • To be honest - the budget is good for me. Corporation tax for small companies down to 20%, CGT on entrepreneurial tax at 10% increased from £2m to first £5m.

    So..... providing I make it through the next 3 years in the worst economic conditions ever, and I continue to make a profit - at least at the end of it, I might make some decent money - could have been worse, but still could have been better!
  • there will be no increase in season tickets at the moment because they are already paid for (the tax point has gone). Half year season tickets will also be OK if bought before January 2011. After that they will have to go up as presumably will match day tickets - although as this will mean a £20 ticket should cost £20.43 I'm sure exactly what the club will do! At least I think that's ok.
    There's a general point here as well if your thinking of buying something early next year it may be wise to buy early!
  • It's a completely regressive tax from a supposedly progressive government. While it's hardly noticeable in the short term, in the long term it will all add up. It's going to cost an average family £11 more a week, which is £572 a year, which mean that by the end of this government it will have cost the average family £2,855. How is it fair that a recession that is the fault of the rich few is paid for by the poor many. And yet the decrease Corporation tax so their friends over at the CBI can sit on even more profit when the economy is up and running again.

    This isn't a budget & a debt being paid for by all as Osborne kept telling us, this is a budget that will hit some of the poorest and most vulnerable people the hardest.
  • The media claimed that reducing it to 15% was pointless so will now don't claim the same now that it has risen by 2.5%.
  • The fact's are that

    - the VAT increase will bring in an estimated £13 billion per annum. Needed? No doubt.
    - that burst into the Treasury coffers will be paid for by all of us, individuals, small businesses, charities, large business, et al.
    - By far the biggest payers - in terms of numbers, not proportionally - will be the finance sector, banks, insurance co's, etc (which in turn will likely be passed onto us, the punter, in extra charges - it's how they roll)
    - the six month lead-in is actually likely to give a (short term) boost to the economy as people/businesses bring forward their spending - although what happens next year is anyone's guess!
    - even at 20% our VAT rate will be no more than "average" for the EU. VAT is a European tax and although Member States have an amount of descretion, we are NEVER going to see, for example, VAT free fags and booze here in the UK (unless you pay cash).
    - this years season tickets will not increase in price and, as stated above, if you get a half seaso before Jan then that price wont (or at least shouldn't) change either.
    - If you don't want to pay VAT then you don't have to. Just never drink, go to restaurants, buy any clothes/CD's/cars/petrol, etc -oh, and pay cash or by barter!
  • [cite]Posted By: Off_it[/cite]...and pay cash or by barter!

    Just don't tell anyone. Bartering in itself is still taxable :-(
  • True, 20% VAT is only average for Europe (Ireland, for example is 21%).

    The way I see it, the danger is the VAT increase will noticebly fuel inflation next year - which then results in the Bank rate being increased, mortgages increased to match, and as always other costs being passed onto the consumer.

    Within a year we could be caught in the beginnings of inflationary spiral ...... wages won't keep up, more people in danger of losing their homes, and don't even mention petrol prices and its effect on prices in the shops, etc.
  • [cite]Posted By: Oggy Red[/cite]True, 20% VAT is only average for Europe (Ireland, for example is 21%).

    The way I see it, the danger is the VAT increase will noticebly fuel inflation next year - which then results in the Bank rate being increased, mortgages increased to match, and as always other costs being passed onto the consumer.

    Within a year we could be caught in the beginnings of inflationary spiral ...... wages won't keep up, more people in danger of losing their homes, and don't even mention petrol prices and its effect on prices in the shops, etc.

    And of course this will kick in just in time for the utilities companies to screw us all with heating and gas costs. Expect people selling thermal underwear and blankets to do well in the winter as no one will be able to afford to heat their homes.
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  • I LAUGH MY ARSE OFF AT PEOPLE WHO EXPECT A PAY INCREASE EACH YEAR. WELCOME TO THE REAL WORLD
  • My dear old Mum, 79 years old and bright as a button, phoned me today.

    She was "cross" (her word) that the VAT increase was specially timed from January 1st and would mean that she would pay more VAT on the bargains she bought in the January Sales.
  • I have had to put my prices up recently for the first time in 6 years,the vat increase means prices will have to go up again and when you are competing with kits manufactured in china, thats hard.
  • Wot, no VAT in China, Steve?


    I bought some stuff online from an American company, paid International priority 72 hour shipping and despatched from the States.

    It took 2 weeks for it to be delivered, sat in some f***ing Customs & Excise warehouse in Coventry.
    And not delivered until I paid £23.00 VAT and £8.00 additional UK delivery charges.

    It seems that I was even charged VAT on the cost of shipping from the States.


    Anyway, what's this all about that you have to pay VAT on items and shipping, sent from the States.
    Is it yet another "official" money making scam to rip off the UK customer?
  • Doing a project due in on Friday for my Uni for a fruit company... totally forgot to factor in VAT into the financial projections and then remembered when I heard the budget... did my nut for about 30 minutes about the extra work that I had to do before remembering that food isn't applicable for VAT, happy days!
  • Just got an email "actually VAT will be applicable because it is delivered, making it a service"... looks like this could be a long long night for me...
  • [cite]Posted By: Clem_Snide[/cite]
    [cite]Posted By: Oggy Red[/cite]True, 20% VAT is only average for Europe (Ireland, for example is 21%).

    The way I see it, the danger is the VAT increase will noticebly fuel inflation next year - which then results in the Bank rate being increased, mortgages increased to match, and as always other costs being passed onto the consumer.

    Within a year we could be caught in the beginnings of inflationary spiral ...... wages won't keep up, more people in danger of losing their homes, and don't even mention petrol prices and its effect on prices in the shops, etc.

    And of course this will kick in just in time for the utilities companies to screw us all with heating and gas costs. Expect people selling thermal underwear and blankets to do well in the winter as no one will be able to afford to heat their homes.

    VAT on domestic energy is 5% going up to 6%
  • All three main parties did not rule out VAT increases pre election. It was a virtual certainty to go up because it is the easiest way to bring in new tax revenues quickly. Is it inflationary? Well yes it may have a marginal effect but that is all in my view.

    My main concerns with the budget is the scale of the deficit reduction over the lifetime of the parliament and the ability/capacity of the private sector to create the jobs which are needed to rebalance the economy.
  • Clem - VAT is 5% on domestic fuel and power and is not changing, despite what Bing says above!

    GNelson - what line of work are you in? Might be a way around having to charge VAT on the whole amount.

    Oggy - it's only right that you pay VAT on imports, otherwise UK businesses are at a disadvantage compared to those overseas - look at staeve with his football kits. If you could buy the same thing from abroard VAT free then everyone would!
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