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Originally Posted by DNSB
So the company that sold you a whatsit for £100 which included 20% VAT and is now selling you a whatsit for £100 with no VAT has not increased their price despite that difference of £20 in what the company gets to keep.
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Correct, the price has not changed. The amount of tax the company you bought it from pays changes but the price you pay doesn't. I'm failing to see why this fact is so hard to grasp? This isn't aimed at you personally by the way I'm meaning in general.
Quote:
Originally Posted by DNSB
Yawn. This endless attempt to claim that VAT is not a tax because the amount is not broken out is getting risible.
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Who's claiming VAT isn't a tax? It is a tax, what it isn't is a sales tax. This seems to be what most people are misunderstanding. A sales tax is only placed at the end of the chain where the item is sold, VAT is charged all along the chain.
Quote:
Originally Posted by DNSB
As for a company not increasing prices with a VAT increase? One of my friends used to work in a lumber business in the UK for years handling their VAT damn near fell off her chair laughing at that suggestion. Her response was that the shelf price labels would be replaced the second the VAT increase took effect if not sooner as in 1979 while in 2008, it took them a couple of months to change their labelling for the VAT decrease.
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You didn't read what I wrote, you've just basically said the same thing I did, at no point did I say that companies wouldn't raise the prices, I said it's not automatic. You've basically just said the same thing "the shelf prices would be replaced instantly" (paraphrased) implying that the prices have to be changed manually... because they do, it's not automatic. Most if not all companies WOULD increase their prices because of a VAT change but it's a manual process.