VAT
I've had two letters today from different companies that they're passing the recent VAT cuts savings onto me.

Now, I'm no taxman, but I am right in saying that it's not their savings to pass on?

It's like the government cutting income tax and then my employer telling me I'm getting a temporary raise.

Or have I got it wrong?
( sandettie light vessel automatic New Twitter - @bollocksreally, Mon 1 Dec 2008, 18:22, 3 replies, latest was 17 years ago)

Nope you're wrong
VAT is a tax paid by companies when they sell goods rather than a tax paid by consumers buying goods.

Of course it can be argued that consumers effectively pay VAT because companies account for VAT when determining what prices to charge for goods but it's the companies, not the consumers, that the tax man will be looking to recover VAT from.
( Captain V, Mon 1 Dec 2008, 18:35, Reply)

I'm glad
they are passing 2.5 extra pence per GB pound to me.
(Ethelred is watching cheese grow, Mon 1 Dec 2008, 19:38, Reply)

I believe it works thus
You (as a retailer) buy a product from a supplier for £100, and pay VAT, thus forking out £117.50.

You then sell to me at £200, plus the VAT I pay, thus I pay £235

You've paid out £17.50 in VAT, and received £35. So, you get back the £17.50 that you'd paid out, and the other £17.50 goes to the VAT man.

So, my phone company (KC) don't pass anything onto us. The net price of their service remains the same, the savings come from the VAT man.
( sandettie light vessel automatic New Twitter - @bollocksreally, Mon 1 Dec 2008, 20:48, Reply)