VAT: Should they display it?

antoinolachtnai

What you are describing would in fact cost millions do do. It would also cost millions per year to enforce. And it would not necessarily result in accurate information in all cases.

That isn't in itself a reason not to do it. Whether it is worth spending the millions is the question.

However, there is no clear argument as to what benefit this would bring to justify the millions it would cost.

Elmo

antoinolachtnai wrote: »

What you are describing would in fact cost millions do do. It would also cost millions per year to enforce. And it would not necessarily result in accurate information in all cases.

That isn't in itself a reason not to do it. Whether it is worth spending the millions is the question.

However, there is no clear argument as to what benefit this would bring to justify the millions it would cost.

So that shops would not make mistakes such as inaccurate information, as I said shops could be charging you VAT on products that don't require VAT purely because they don't know, at least if the customer can see then they know what a shop is charging.

As for the enforcement surely this enforcement would be part of the same enforcement body that insures that Restrautants display their menus and that shops put price tags on all shelfs for each product.

There are plenty of other things that we go around enforcing this would just become part of those other enforcement measures.

jor el

antoinolachtnai wrote: »

However, there is no clear argument as to what benefit this would bring to justify the millions it would cost.

This is what I said earlier, I can't see what benefit this would actually bring to anyone, business or consumer. It's not going to change anything.

Elmo wrote: »

So that shops would not make mistakes such as inaccurate information, as I said shops could be charging you VAT on products that don't require VAT purely because they don't know, at least if the customer can see then they know what a shop is charging.

If a shop is putting the wrong VAT on products, then their accountants or an audit should spot it. A business should know it's business anyway, and not charge the wrong VAT. I would suspect that this is a very rare situation, especially where barcode scanning is in use.

Displaying the amount of VAT you paid is just information, it doesn't change anything, and IMO, it's pointless information.

antoinolachtnai

The law in relation to display of prices is not really enforced to any great extent at the moment. Extending the scope of the enforcement to add extra aspects would certainly have a cost.

Any retailer who is miscalculating VAT and overcharging as a consequence is going to end up very uncompetitive in the marketplace. If anything, the opposite might be happening. And I think we do have an acceptable enough level of VAT enforcement for areas like retail.

K-9

Danno wrote: »

I think alot of people contributing on this thread are loosing the run of themselves. A simple practice, without costing €Millions, would involve setting a date - Say 1st February 2010, whereby all businesses selling to the public would have to display the amount of VAT paid in the transaction, both on the price ticket, the reciept and any advertisements. I would safely say that 90% of reciepts already give a break down, and quite alot of advertisements.

What customers should be entitled to see is...

EXAMPLE 1:
Local shop selling a slice of bread: Price ticket says: PRICE: €1.00, includes €0.00 VAT.

EXAMPLE 2:
Local pub selling pint of Guinness: Price ticket says: PRICE €4.00, includes €0.71 VAT and €1.48 Excise Tax

EXAMPLE 3:
Car Valeting Service: Price ticket says: PRICE €113.50, includes €13.50 VAT.

Any reciepts issued should display the same information.

Simple to implement.

Many places already show the VAT, EG. Diesel or your Car Valeting Service example as they often are VAT deductible.

The problem with grocery items is, say you do your weekly shop, many would have 0% or 21%. They would have to update or get new software to show all items at 0 and 21.

Who pays for this? I presume the consumer as it's for the consumers benefit?

Anyway, overall I can't see the benefit in this.

Alcatel

In the US they often display the price pre-tax, then you get zinged for that at the till.

However, they could display the price on the sticker - like the way that with electrical goods the final price is displayed (let's say 999 euro), and below it's shown to be (989 + 10 PRF) - it tells you how the final price is made up of the shop price plus the WEEE recycling money.

They could do the same with VAT:
100
(78.50 + 21.50 VAT)

rainbowtrout

Having the rate of VAT on display would be useful. I'm not particularly bothered by how much I'm paying as it has to be paid, but I wonder how many products in supermarkets increased in price after the November budget. Most people would have just put this down to the rate increasing to 21.5%. Many people don't know there are different rates for different products and I wouldn't be surprised if some products increased in price despite having a rate of 0%. There are several posts here saying customers are lazy and can find out the rate for products if they look. They aren't going to look if they don't know there are different rates.

Most consumers are just going to put it down to increased rates without realising there was no real reason for the increase other than the retailer taking advantage of people's ignorance surrounding VAT rates and what products they are applied to.

It would work the other way too if there was a decrease in the standard rate, the price of an item should then drop, if it doesn't then the retailer is just making extra profit at the expense of the customer.

antoinolachtnai

rainbowtrout wrote: »

Having the rate of VAT on display would be useful. I'm not particularly bothered by how much I'm paying as it has to be paid, but I wonder how many products in supermarkets increased in price after the November budget. Most people would have just put this down to the rate increasing to 21.5%. Many people don't know there are different rates for different products and I wouldn't be surprised if some products increased in price despite having a rate of 0%.

In your opinion, was there actually an increase in prices of food items after the November budget?

rainbowtrout

antoinolachtnai wrote: »

In your opinion, was there actually an increase in prices of food items after the November budget?

I have no idea, i've been doing my food shopping in Enniskillen for the last 6 or 7 months. I just notice anytime I shop in my local tesco that prices are constantly increasing, there's a thread about that here too, and it would be an opportune time for retailers to increase their prices when there is an increase in VAT rates.

Elmo

antoinolachtnai wrote: »

In your opinion, was there actually an increase in prices of food items after the November budget?

This is my whole point, I also think that shops increase price after a VAT increase regardless of price.

Only one VAT rate increased, but how many products increased in price?

Elmo

Also I just wanted to say that I am very impressed by all posts on this thread. First time I have noticed actual debate which has yet to fall into a complete mess about nothing. Thanks. (I am going to regret saying that, I am sure their are other good threads that have kept up the debate.)

K-9

Elmo wrote: »

This is my whole point, I also think that shops increase price after a VAT increase regardless of price.

Only one VAT rate increased, but how many products increased in price?

Even if a product is zero rated does not mean its costs are not affected by VAT rises.

Elmo

K-9 wrote: »

Even if a product is zero rated does not mean its costs are not affected by VAT rises.

The cost of that product should not be affected by VAT rises. For example a Slice Pan of Bread costing 1.50 should not increase the day or week after the budget just because the higher rate of VAT increased. I would love to know what reasoning would be behind such an increase a few weeks after the VAT increase???????

K-9

Elmo wrote: »

The cost of that product should not be affected by VAT rises. For example a Slice Pan of Bread costing 1.50 should not increase the day or week after the budget just because the higher rate of VAT increased. I would love to know what reasoning would be behind such an increase a few weeks after the VAT increase???????

Perfect example, Bread. How does it get to the shop and what costs are involved in making it?

I'll compare to Diesel. The price of Diesel skyrocketed last year and it affected all prices. VAT going up effects all businesses, even ones that don't charge VAT.

Also, there could be other reasons the Bread rose, cost of materials etc., nothing whatsoever to do with the VAT alone.

Elmo

K-9 wrote: »

Perfect example, Bread. How does it get to the shop and what costs are involved in making it?

I'll compare to Diesel. The price of Diesel skyrocketed last year and it affected all prices. VAT going up effects all businesses, even ones that don't charge VAT.

Also, there could be other reasons the Bread rose, cost of materials etc., nothing whatsoever to do with the VAT alone.

I am not talking about other reasons for bread to go up alone because of increased transport costs (I assume that they claim back VAT, Duties etc on distribution of their goods?????)

K-9

Elmo wrote: »

I am not talking about other reasons for bread to go up alone because of increased transport costs (I assume that they claim back VAT, Duties etc on distribution of their goods?????)

Indeed, though cash flow wise, they don't get back for 2/4/6/12 months depending on the business.

They can't claim Duties AFAIK.

the groutch

only way it would be useful is if UK was doing it, then it could be used to show people arent getting ripped off as much as they think (especially with magazines)

Elmo

the groutch wrote: »

only way it would be useful is if UK was doing it, then it could be used to show people arent getting ripped off as much as they think (especially with magazines)

I bought Computer ArtS about a year ago and noted how expensive it was until I looked at the UK price which was around the same, currency exchange may have helped.

Redbilby

Interestingly enough as a shopper aware of rates charged on a lot of my weekly items I am constantly watching money to be saved by buying the item/brand with the lowest VAT rate or better still 0%VAT.

This actually saves quite a few € over a weekly grocery shop ... and gives me some satisfaction when i consider what the Gov't has done with all the VAT I have previously paid.

As money becomes tighter people are entitled to know what rate is charged on what items, a large display poster in the shops with the general catergories would suffice then most of us interested enough could do our own research and those that cant be bothered just keep on paying!

RB
And to anyone who thinks tampons/sanitary items are a luxury VAT 21.5% just try having to put up with using them for a few months, luxury, i dont think so!

K-9

Redbilby wrote: »

Interestingly enough as a shopper aware of rates charged on a lot of my weekly items I am constantly watching money to be saved by buying the item/brand with the lowest VAT rate or better still 0%VAT.

This actually saves quite a few € over a weekly grocery shop ... and gives me some satisfaction when i consider what the Gov't has done with all the VAT I have previously paid.

As money becomes tighter people are entitled to know what rate is charged on what items, a large display poster in the shops with the general catergories would suffice then most of us interested enough could do our own research and those that cant be bothered just keep on paying!

RB
And to anyone who thinks tampons/sanitary items are a luxury VAT 21.5% just try having to put up with using them for a few months, luxury, i dont think so!

LOL on the sanitary towels, condoms is another one.

I'm interested in how you base your shopping decisions on VAT rates. Surely you wouldn't pay more for an item because it has a 0% rate?

Elmo

K-9 wrote: »

LOL on the sanitary towels, condoms is another one.

I'm interested in how you base your shopping decisions on VAT rates. Surely you wouldn't pay more for an item because it has a 0% rate?

A plain Biscuit v A Chocolate Biscuit, saves you some money and is a tiny bit heathlier

Didn't they reduce the price of condoms to 13.5% ?

rubadub

rubadub wrote: »

The price is the same, but as I mentioned before somebody might not choose to buy the product if they know the VAT, so it could affect some peoples decision to buy or not.

Stekelly wrote: »

Those people are stupid. I've also yet to meet anyone who buys depending on Vat rate.

Have you actually asked people this, or just presuming? I know people who buy stuff depending on VAT rate. If you (and others) bothered to read my posts you might realise why, I explained it a few times. It would be stupid of them NOT to take it into account.

the groutch wrote: »

only way it would be useful is if UK was doing it, then it could be used to show people arent getting ripped off as much as they think (especially with magazines)

They would also need to show wholesale prices, which I think have a far more effect price charged.

K-9

Elmo wrote: »

A plain Biscuit v A Chocolate Biscuit, saves you some money and is a tiny bit heathlier

Didn't they reduce the price of condoms to 13.5% ?

They may have.

Rich Tea, nice, choccie McVities gorgeous!

The McVities is a luxury item though.

Red Alert

The shops all have the ability to display the VAT total per sale and on the shelf-edge labels: I've a feeling there's a bit of stubbornness on their part not to.

antoinolachtnai

They don't all have the ability to do it. Shops aren't required to use shelf-edge labels. They would still need a degree of reprogramming to put the VAT on there.

It isn't just an issue of stubbornness. It's that there are quite a lot of numbers on the tag already. Will adding another one really make anything clearer?

Elmo

antoinolachtnai wrote: »

Shops aren't required to use shelf-edge labels.

Yes they are, I even think they are supposed to mark each item with a price tag individually.

parsi

Elmo wrote: »

A plain Biscuit v A Chocolate Biscuit, saves you some money and is a tiny bit heathlier

Didn't they reduce the price of condoms to 13.5% ?

I (Still) don't get this.

Are we saying that because VAT is lower folk will buy a cheaper wheaten biscuit in preference to a chocolate enrobed buscuit ?

Or is it the case that folk will buy the wheaten biscuit because it is cheaper ?

Or are we saying that if the choice is between a cheapr biscuit and a dearer biscuit folk will choose the one with less VAT in order to sock it to the Government ?

We already have unit/weight-based pricing and anecdotally it would seem that a lot of people don't bother performing comparisons on this basis.

K-9

parsi wrote: »

I (Still) don't get this.

Are we saying that because VAT is lower folk will buy a cheaper wheaten biscuit in preference to a chocolate enrobed buscuit ?

Or is it the case that folk will buy the wheaten biscuit because it is cheaper ?

Or are we saying that if the choice is between a cheapr biscuit and a dearer biscuit folk will choose the one with less VAT in order to sock it to the Government ?

We already have unit/weight-based pricing and anecdotally it would seem that a lot of people don't bother performing comparisons on this basis.

I don't get it either.

Redbilby

I'm constantly watching the cents, single income, 3 kids .....you all know how it goes by now:-).

I compare the prices by unit/weight and whatever other means is available to me and would strive to buy the VAT free item every time if I could. There are heaps of items taxed as luxuries that just are not and this drives me mad as does the Gov't saying we all have to pay for past mistakes. This is my small way of protesting I guess.

antoinolachtnai

Surely all that matters is the end price, not the VAT or VAT-free status of the product?

Products with VAT and without VAT are simply not comparable or substitutable for each other in general. If you want cake, bread is no good to you, no matter what the VAT rate is.

On the other hand, if you are shopping on price, then the end-price is what matters not whether a proportion of the money goes to the government rather than to the supply-chain (the farmer, the factory, the trucker, the distributor, the shop, etc.)

VAT is not a luxury tax. Everything is subject to VAT, with a few exceptions, such as groceries. It's crap, but that's how it is.