Frosticles

iTrader: (1)

Ah, the slide to us becoming a 3rd world country continues.

f1_fan

iTrader: (9)

Couldn't do any worse

Why can Osborne not work out that when things become too high a price people stop buying them.... look at petrol, massive downturn in sales... so he puts VAT up and the sales decrease further meaning the absioute amount he collects gets even lower and the economy stagnates even more!

Hammer man

iTrader: (25)

Couldnt say to be honest. It just depends on your situation. You can always opt in (if they let you) and opt back out if you feel your worse off. Best bet is to ask your accountant first..

I do collect vat. You only pay more vat on liable purchases when you make a purchase in the first place. If you persuade your customes to supply the purchases for you, they deal with the vat.

Oh lord...please no Watchin his football is more than enough pain for me thanks.

dpb

You sound like a true child of the empire

pflowers

That is very true, although I wouldn't fancy your chances in a Vat inspection.

f1_fan

iTrader: (9)

No just understand the law of diminishing returns!

Hammer man

iTrader: (25)

Whys that? I cant force my customers to insist that I supply the purchases. If they choose to supply, thats up to them.
3 inspections in 27 years of trading too

pflowers

The flat rate that you select based on your business type is calculated based on the average vat liable purchase to turnover percentage.

The average business in that category would therefore be no better off but no worse off. There will of course always be people either side of the average for that category who for whatever reason buy either more or less goods that are vat liable. However if your customers are buying these goods and claiming
Vat back on them that you would not have been able to claim, the vat man is losing money.

So for example if you were a builder on the flat rate scheme, how could you explain that you didn't need to buy any materials?

boomer

Brilliant news, and let's hope that he puts it back on pasties as well so that chavs might contribute a little to the treasury as well

mb

Saint AAI

http://news.sky.com/story/1016241/va...cent-warns-ifs

Doesn't say anything other than the IFS warns it may have to go up.

ReallyReallyGoodMeat

A story about the IMF warning Osborne that he may need to raise VAT, becomes
"Osbounre raises VAT to 25% in April!"

Am I on the daily mail website?!

dpb

Worse

Tidgy

no, its just an update from BSlewis

speedking

IFS not IMF, that would be of more concern.

f1_fan Just because prices go up doesn't mean I spend less I have £100 to spend and the government gets £20. Next year i will still spend the £100 but the government gets £25. Prices will rise and I will get less for my money, but I won't spend less.

Leslie

I must say that is pretty bad news if it is true.

Pete, can you tell us who put the country in such a position financially that this may be considered necessary?

Les

rossyboy

iTrader: (8)

I seriously doubt it. The government wants us to spend to keep the economy going. Increasing the price of stuff will have the opposite effect.

Self defeating policy IMO.

john banks

Certainly would make me think more than twice about any building work or big ticket purchases that would expose me to that VAT rate, I'd just save more. Not what they want! Only exception would be buying stuff at liquidation because of all the retailers that would go under.

f1_fan

iTrader: (9)

Sorry but it doesn't work like that. In very simplistic terms you''re right that you may still spend 100 but you get less for your money so the company you are buying off makes less profit. Therefore more comopanies will go under meaning more unemployed, more benefit payments and less disposable income hence ultimately less VAT revenue.

There is a statistician's curve (can't remember the name) that plots price against demand and indicates the point at which total revenue starts to drop because the price has got so high fewer and fewer people are buying and are no longer making up the difference despite the higher price .... petrol has gone over that peak now and won't come back unless the overal price drops... adding more duty and VAT will actually result in less absolute revenue in the longer term.

TelBoy

http://en.wikipedia.org/wiki/Laffer_curve

f1_fan

iTrader: (9)

That's the one, it's a long time since I studied all that good stuff and I made a right hash of explaining it above

SPEN555

PMSL! Lewis you are such a stirrer. He has completely twisted it.

A computation was done and found that in order to pay back the deficit in the timescale that the Conservatives suggested meant that due to the economy not doing as well as expected meant it was EQUIVALENT of having to put VAT upto 25%.

They would not dare do that. It would kill the economy stone dead

r32

Whether its true or not (and I think it could happen) have these people never heard of more may be less?

Like the steady increase in fuel prices has resulted in people buying more economical vehicles or using their vehicles less has resulted in less revenue. The huge cuts in public and private employment resultes in more people on benefit and less income taxes and national insurance paid into HMG. An increase in VAT will result in less vat receipts as people spend less.

PaulC72

It's ok if you claim vat back, but you still have to buy things and pay vat on them as you are unable to claim back everything so it would make a difference to everyone.

If it was to happen which it wouldnt as it would cripple us....fuel, for a start would be enough to break allot of people.

speedking

Why would you spend less because VAT had increased?

Yes the government will get more of your money and the retailer less. Yes you will get less goods and services for your money. But why would you spend less

In fact some people might dip into their savings to maintain their current standard of living, so everyone's a winner, except the banks.