No seriously, what is the point of 15% VAT? I was thinking about this yesterday as I stared at a receipt from the local Asda. UK.gov introduced this as a way of passing savings to consumers, but at the end of the day on most large shopping trips it’s going to make the difference of a couple of pounds maximum. My receipt had the grand total of 39 pence of VAT. I’m sure I could’ve got by with 4 or 5 pence less, especially as many household items and sundries are exempt from VAT altogether anyway. (Cakes are handily exempt!)
And in the meantime? Well, most businesses claim VAT back anyway, and while they’re spending less up front due to the lower VAT rate, they’re still having a tougher time in the long run because the VAT they claim back from HMRC on their own expenditure won’t be as much. Some companies have raised their pre-VAT prices to the equivalent of when the VAT rate was 17.5%, a bit of a sly move – so businesses who have to pay these artificially inflated prices will be struggling as a result because they’ll get less back on balance today than they would have before the VAT rate cut.
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And aside from that, this VAT rate cut has caused a massive amount of wasted time and money as companies either have to rejig, rewrite or reorganise their own billing systems and inventories, and it’ll happen again when the rate returns to 17.5% (or higher, knowing Mr. Broon!) Think how insanely impractical it’s been for supermarkets to have to reprice all of their items and go round replacing every single price ticket on all shelves… And that’s a comparatively minor hassle compared to the issues many other companies will have faced across all sorts of market sectors.
All in all, I think the UK could’ve done quite nicely without the VAT rate cut. Instead, why didn’t UK.gov take the money they would’ve otherwise been getting from us taxpayers, and give some to the Highways Agency (so they wouldn’t be forced to economise and only grit the main highways and roads) – and make sure they have enough rock salt for the depots to avoid shortages in the first place? It’s typical – countries like Sarajevo have our levels of snowfall for months on end during the winter, and they cope fine with it. Admittedly, the gritting and road clearance budget of a Scandinavian country like Finland (with a comparative road network to ours) is approximately three times that of the UK, but seriously, come on! We don’t have several inches of snowfall every day, surely we can afford to better prepare ourselves for these inevitable ‘freak’ snowfalls to avoid the farcical situation this country faced again this year.
On a related note, Keith Adams from AROnline counted how many idiotic drivers were driving around in the morning without using their headlights… You might be surprised at how many prats he encountered (and the curious trend he uncovered). Remember people, using your headlights is as much for other peoples’ benefit as your own!