Whats everyone think of the 2.5% cut in VAT??
 

As the title says....whats your views :lol1:

Waste of time or good idea?

Won't influence my spending in any way shape or form.

And I think the idea is to get us to wet our pants in excitement and spend to save the good ship Titanic UK

Good idea while also being a waste of time. Its probably the only tax cut they could have given while still stimulating the market. Its a no lose tax cut as far as creating more spending goes as you have to spend to benefit from it.

Is it enough? Not on its own but as part of a package it might help.

Its always made me laugh ...'Value' added tax

If they want to get people spending, they need to give people more spending power by increasing their take home. Knocking £2.50 off an £100 luxuary item isn't going to make a difference when there are people out there struggling to buy food which is mostly VAT free anyway.

It's going to be a pain in the butt.
Got so used to working out VAT at 17.5% when invoicing that I do it without thinking.
I bet some incorrect invoices go out!

Like someone on the TV said this morning: "If your job is at risk, you can't heat your home and you could lose your home if you lose your job, are you REALLY going to celebrate tonight with a bottle of wine because it costs 15p less?"

It's b*llox, F*kwit Darling knows it, Sh*t Brown knows it and most of all, WE know it.

A lame, nothing, gesture from a failing government. Labour out, NOW:thumb:

Hw much of the reduction are we likely to see? If youre buying in amarket where ex-VAT prices are commonly displayed, then youve a reasonable chance. In most of the retail business VAT inclusive prices are the norm and I suspect that many will get fleeced...

Waste of time, I can't believe they are going to do this (until I hear it officially announced)

The VAT rate is to help struggleing business survive it will make no difference to peoples shopping other than to keep more people employed.

"Oh look Peaches honey - those shoes you had your eye on are a whole 2.5% cheaper now - WOWEE. Daddikins will be so pleased! Why wait till the sales next week when they will only be half price?"


Complete load of tosh from HMG. And we will be bloody well be paying for it :mad:

dl

Friendly fiver says they do. Tenner if you like.

And it won't be a waste of time. There is always somebody for whom 2.5% will be the difference between buying and not buying, and the value of that will be more than you'd imagine.

Most shops will simply absorb the 2.5% as it would cost too much to reprogram the EPOS and shelf tags.

And another tenner says that won't happen either, if "most" means 50% or more.


You lot don't know very much about marginal tax rate sensitivity!!

It helps, in terms of I'm happy to pay 2.5% less on some of the things I buy but I don't think it'll make that much difference in the overall scheme of things. It will just put the government in more debt.

Steve

And also the fact that they will be hitting the richer earners a bit more, although i cant understand how? youll see what they do in other countries next (cant remember which countries) where if you break the law or get a speeding ticket, the fine you get corresponds to a certain %age your annual earnings, so someone on 15k a year would have a smaller fine than that who earns 85k a year- and that would be a bloody great fine! lol

government is pants to be honest, high tax, reduction in vat one day theyll make their minds up

I believe for most people 'marginal tax rate sensitivity' is about 10%. For non-Vat Registered businesses and consumers, 15 or 17.5% makes very little difference in the price that they see. Don't forget that input VAT will also be reduced by the same amount so businesses do not gain and simply have the cost of changing their systems as they act as the Government's tax collector.

Waste of time IMHO.

Saving 2.5% in Vat is not going to make you go out and shop like there is no tomorrow.

Buy a £10k car, save £250............ Wow. I'll take 2.

I'd have liked more money in my pay cheque every month.

How do you work that out?

It won't really help business's out in the slightest.
Business sells something for £117.50 including VAT which you buy.
You pay them £117.50, they keep £100 and give the other £17.50 to the government.

But now you'll only have to pay £115 instead of £117.50.
Said business still get their £100.

You win!

I expect to be hit hard in the pocket in the years that come to pay for this.

The governement didn't provision for the current mess we're in. Whilst they are not responsible for the mess, they are complacent in not having put aside contingency to see the country through. It's not difficult to save a little here and a little there, why didn't they do this for the last 11 years?

Do you have a strong opinion on this....? You really ought to say what you mean and not beat around the bush ;)

But I have to agree with you :thumb:

Telboy, I think they will do it unfortunately, however I agree with the other posters, the impact to the end consumer is miniscule.

I read that the idea is supposed to be a confidence booster and maybe it will be to the average man in the street who now pays a few pence less for a pint. It won't make people spend though.

In my business, I simply charge VAT and pass it on. My supplier gets the tax from their consumer sales. More of a headache to me now as i have to watch the date of invoice and adjust my return (due next week) accordingly. now if it were back dated I'd be very happy ;)

As I'm a sad and lonely computer person, I wonder how many systems have the VAT rate hard coded ....

Steve

I think this will make very little difference to the majority of the population of this country. As has been said on here many times already, who's going to spend £10 to save 25p?
As for helping businesses, they must all be jumping up and down for joy at the extra work this has cost them in re-pricing and re-programming sales systems, not to mention re-printing any sales paperwork that carries a reference to VAT at 17.5%.
And are we going to have to pay for it again when we come out the other side of the recession?
Just a lot!

You just can't trust somebody who has to borrow a pair of eyebrows, especially when he doesn't have the sense to make sure they match his own hair. :)

Playing devils advocate here... in theory you will have more money every month as you will be paying less VAT on the things you buy regularly. Petrol being one of them.

Little difference individually perhaps, but cumulatively it won't be insignificant, that's my point.

My biggest problem is the utter fool delivering the speech right now...

for every full priced new release DVD i buy I can now effectively get a free Mars bar.....
I cant help think that this is more spin than resolve.

Do you honestly believe that that 2.5% is there for you to retain, to bolster your margin? Its purpose is to keep people spending, not to line the pockets of greedy publicans. If you need more business you can lower the price that you charge people for a soft drink.

The VAT cut is only temporary. Now that's tinkering. £12bn's worth but still.

Duty to go up on petrol so you don't see any benefit of the VAT reduction.