There is some confusion about the implications of the change in VAT.
First off, the potential saving is 2.1%, not 2.5%. This is because the saving relates to the VAT, not the whole value.
So a widget that sold for £11.75 on 30 November should cost £11.50 on 1 December. The saving is therefore 25p. 25p as a percentage of £11.75 is 2.128% (call it 2.1%), not 2.5%.
Hardly something to write home about and I have my eyes peeled to find anyone who is actually passing this saving onto the customer. Anyone found a bargain yet?
Tags: budget, Change, rate, VAT
December 1st, 2008 at 11:21 am
[...] Envirojean wrote an interesting post today onHere’s a quick excerpt There is some confusion about the implications of the change in VAT. First off, the potential saving is 2.1%, not 2.5%. This is because the saving relates to the VAT, not the whole value. So a widget that sold for £11.75 on 30 November should cost £11.50 on 1 December. The saving is therefore 25p. 25p as a percentage of £11.75 is 2.128% (call it 2.1%), not 2.5%. Hardly something to write home about and I have my eyes peeled to find anyone who is actually passing this saving onto the customer [...]