Maybe the Americans got this right afterall

[beorhthelm]

With income tax you can choose to a certain degree what you want to pay tax on. With vat on petrol gas electric etc you can't.

really, you can chose if you pay income tax or not? using some creative accounting, offshore account etc? or do you have this 180 degrees the wrong way round?


sales tax or VAT, its the same thing with a different name. you can't avoid paying it, so why bother showing the ex VAT prices?

 

[Simster]

Value Added Tax is an absolute joke,and how the value added can rise by 2.5% overnight is beyond me.It's a government tax pure and simple,so why not call it Government Added Tax,or Additional Government Tax so that we all know its value.

And this annoys me too. Apparently it's a 2.5% increase.

Well no, no it isn't. It's a jump from 17.5% to 20%. That's a 14.3% tax hike, not 2.5%.

 

[Gritt23]

Personally, I think people are making too much of what is a price rise of just over 2%. The reverse situation would have us running to the shops to spend .... well, it didn't did it, when we had the temporary drop from 17.5% to 15% VAT.

As for ticket prices, then I really don't see the benefit of have prices excl VAT displayed, but I certainly see the annoyance of having to work out what you are actually going to pay. Prices should show the VAT inclusive price for me.

 

[Chicken Run]

Personally, I think people are making too much of what is a price rise of just over 2%. The reverse situation would have us running to the shops to spend .... well, it didn't did it, when we had the temporary drop from 17.5% to 15% VAT.

As for ticket prices, then I really don't see the benefit of have prices excl VAT displayed, but I certainly see the annoyance of having to work out what you are actually going to pay. Prices should show the VAT inclusive price for me.

That!

 

[GOM]

Value Added Tax is an absolute joke,and how the value added can rise by 2.5% overnight is beyond me.It's a government tax pure and simple,so why not call it Government Added Tax,or Additional Government Tax so that we all know its value.

By that logic all tax would be called Government Tax and it would become very confusing.
The VAT relates to a products journey through the supply chain, whereby a tax is effectively levied on the increase in value between the buying and seling price at each stage.

 

[Robbie G]

Classic error a lot of the press make in reporting it. It's a 2.5% POINT increase rather than a 2.5% increase. It's just laziness in reporting or saying it.

Great to catch people out with that difference as it can often make a lot of difference.

 

[Seagull over NZ]

Can you imagine if they installed the Amercian system in shops over here. People's mental arithmetic is appalling. I had to pay for a block of training sessions the other day which were £27.50 each. I said I would like to pay for 10 sessions please. She looked at me and said, do you have a calculator. I said that it would be £275 and she looked at me as if I was the brain of Britain. Good grief.....

 

[Badger]

I'm well and truly in the "the price you see is the price you pay" camp, especially if you have limited cash on you and you don't want to pick up more than you can afford. It's made even worse in America by the fact that all their notes look the same and they still insist on having a 1 dollar bill (unless that has changed in the last 2 years), it's ridiculous.

 

[Lyndhurst 14]

It's made even worse in America by the fact that all their notes look the same and they still insist on having a 1 dollar bill (unless that has changed in the last 2 years), it's ridiculous.

Agreed. There is a $1 coin but in very limited circulation at the minute. The only thing the dollar bill is good for is the tittie bars.

 

[The Spanish]

Agreed. There is a $1 coin but in very limited circulation at the minute. The only thing the dollar bill is good for is the tittie bars.

i like them you can get loads and pretend to be a rapper.

 

[Chicken Runner61]

really, you can chose if you pay income tax or not? using some creative accounting, offshore account etc? or do you have this 180 degrees the wrong way round?


sales tax or VAT, its the same thing with a different name. you can't avoid paying it, so why bother showing the ex VAT prices?

Sorry I didn't make that very clear did I?

What I meant was ......

Once you have your wages after income tax you can decide if you want to buy anything else that might have an additional tax on it (it used to be called sales tax) but with vat generally put on everything you can't really escape it.

Even on zero rated goods you can end up paying vat in some form because its likely you have paid the vat on the fuel element that your supplier might not have reclaimed but added in your bill!

Many traders used the new system where they pay a fixed rate vat bill. Some are making extra money because they pay the IR a fixed 10%-20% banding that they are on but are allowed to charge 20%.

On another tack if you go to a lot of builders merchants you will find you are quoted net prices. Again its because some stuff is zero rated

 

[Chicken Runner61]

Anyway isn't the whole point of shops telling you the price without sales or vat is so you realise that the reason its expensive is because the government adds on 20% to what you would have been charged in the first place!

You have already paid 30% tax on the money you have in your pocket to the government and now they make the shopkeeper look like he is robbing you of another 20% rather than them!

 

[Chicken Runner61]

No a lot of food has vat on

For example:
Wholly or partly chocolate coated biscuits
Gingerbread man decorated with chocolate (unless this amounts to no more than two chocolate eyes!)
Arctic Rolls
Sorbet
Chocolate bar
Nuts or fruits covered in chocolate or yogurt
Flavourings for milk shake
Potato crisps
Roasted or salted nuts without shells

and everything you buy from a take away or restaurant

That's because they are snacks rather than staple foods

 

[RexCathedra]

Anyone who thinks overall US tax rate is lower than UK is sorely mistaken. The system here is very complex. Income Taxes (Federal, State, Local), Property Tax, Sales Tax, Social Security Tax, Healthcare Insurance (which is really a tax) depending on where you live, this will set you back 50% of gross income or more. I like living here BUT the taxation system is OUT OF CONTROL.

If you're paying anything like 50% of you gross income in taxes, of all kinds, you're not doing it right, making ridiculous money, or living on Manhattan.

Remember that property tax and state sales and income taxes are deductible from federal income tax, so in any calculation you have to reduce them by the appropriate amount.

The top Federal rate -- 35% -- is a marginal rate, not paid from dollar one, but from dollar $350,000 or so.

On $90,000 of joint income last year, my wife and I, family of four -- two kids in uni -- paid:

about $9k in federal income tax (I'm not including the $3.5k offset for our kids' college tutition, that's not typical),
about $6k in combined other taxes (state sales, state income, property, auto excise).
about $8Kfor social security and medicare...

(We don't drink or smoke enough for sin taxes to matter much)

$22~$23K in total taxes, give or take. At $90,000 combined income (in the top 10% nationally), about a quarter of our income goes to taxes and social insurance schemes. You could double our admittedly low property tax, and it might -- might -- climb to just under 30% Add health insurance -- premiums are deductible from federal tax, btw -- and you might get to 38% or so.

The reality is, Americans are very lightly taxed by all but American standards -- and we get the level of social provision you'd expect in a cheapskate nation like it is.

 

[Guy Fawkes]

As everyone knows, the North Americans quote everything before state/provincial and federal value added tax is applied. So in other words, if you you see a CD for sale at $9.99, you'll end up paying $10+ for it.

I always found this very annoying, and still do when I'm over there. Just tell me what I'm expected to pay, tax is one of lifes guarantees I'm afraid.

However, I think I'm open to changing my mind on the subject. I am totally f***ed off that we have seen VAT leap from 10% when first introduced in 1974, to double that as of Jan 1st this year. As far as I can recall, I don't think there has ever been a period where this has reduced.

In actual fact, looking at wikipedia, our VAT rate is broadly in line with the rest of Europe, but nevertheless I'm just not convinced Europe has got it right.

My main issue is that it is an easy tax to hide. Sure, we all know it is 20%, but when you buy anything in a shop, it just isn't all that apparent how much we're being clobbered. This is in stark contrast to income tax. You sure as hell realise what you're paying in IT and NI when it's deducted at source.

Personally I am beginning to think it is high time shops considered quoting prices ex-VAT. At the very least, I think it'll make it less transparent and people can make more of an informed choice of how they prefer to be taxed.

People buy items based on what they want and can afford, the more expensive/luxurious the item, the greater the amount of VAT paid on it. For example, buying a TV - Someone buying a top of the range 3DTV may be paying about £1500 of which £300 is VAT, someone buying a standard TV maybe paying £150 and therefore pays just £30 in VAT (20 % of the total for each)

This means that the person making the purchases has a choice in how much they pay (if any), Poorer people would pay less as they would tend to buy cheaper items that would therefore carry less VAT (amount)

Using income tax instead means its a compulsory tax for those working and earning, however not everyone will be working and therefore not everyone will be paying it and contributing towards state funded measures like the NHS, Police etc.... However using VAT means that a wealthy person who doesn't work decides to buy something, they are paying taxes towards the state funds. If a low earner decided to save rather than spend, under the Income tax route they would still lose money to the state whereas by buying fewer VAT inclusive items, their tax contribution could decrease despite the rate rise. VAT is on non essentials, and as such means that the consumer has a choice and not made to pay whatever happens.

The ticket price should show the overall price rather than the VAT excluded price, its not as if people buy based on how much of the items cost is tax and there isn't the choice to pay less VAT on the same priced item if purchased elsewhere is there?

 

[tubaman]

scrap income tax and load everything on as VAT. There is an incentive to earn more and the more you buy the more tax you pay...........Simples

 

[Storer68]

Value Added Tax is an absolute joke,and how the value added can rise by 2.5% overnight is beyond me.It's a government tax pure and simple,so why not call it Government Added Tax,or Additional Government Tax so that we all know its value.

I think you'll find that ALL tax is government tax, pure and simple.