Skip to navigation

PCPro-Computing in the Real World Printed from www.pcpro.co.uk

Register to receive our regular email newsletter at http://www.pcpro.co.uk/registration.

The newsletter contains links to our latest PC news, product reviews, features and how-to guides, plus special offers and competitions.

Analysis

6 - VAT makes UK prices look artificially high

Posted on 12 Jul 2007 at 11:15

Verdict: <strong>True</strong>

One of the few points that stand up is the case of VAT, a hidden cost that's included in prices advertised in the UK, but which is added to prices shown States-side. So software that's advertised at $150 could actually cost $160 with after-sales taxes. "It's the hidden taxes such as VAT that have an impact," says Pentecoste. "It makes things in the US look cheaper than they are, but even so it isn't 17.5% [which we pay here] once you've included sales tax."

US sales tax rates are decided on a state-by-state basis, with some states such as Alaska and Montana charging nothing, and 7% being the highest rate charged. Nationwide, the US average is 5.5% added to the price at the checkout, according to the Federation of Tax Inspectors.

Take that 5.5% sales tax away from the 17.5% VAT we pay, and in one fell swoop VAT can justify around 11% of the difference between UK and US prices. There's plenty left...

Back to 'Rip-off Britain: excuses exposed'.

Author: Stewart Mitchell

Be the first to comment this article

You need to Login or Register to comment.

(optional)

advertisement

Most Commented Features
Latest News Stories Subscribe to our RSS Feeds
Latest Blog Posts Subscribe to our RSS Feeds
Latest Reviews Subscribe to our RSS Feeds
Latest Real World Computing

advertisement

Sponsored Links
 
SEARCH
SIGN UP

Your email:

Your password:

remember me

advertisement


Hitwise Top 10 Website 2008