VAT change 'needs delaying'
Mar 09 2009
The reintroduction of the full value added tax (VAT) rate comes at the 'worst possible time of year' for retailers, an industry organisation has suggested.
According to the British Retail Consortium (BRC), the government should delay the increase for at least one month beyond the current due date of December 31st, as this is the busiest period for stores.
The organisation says that it cost the sector around £90 million to temporarily reduce VAT from 17.5 per cent to 15 per cent and will cost a similar amount to carry out the restoration.
Stephen Robertson, BRC director general, comments: 'Changing VAT rates back to 17.5 per cent at the end of December will soak up a lot of effort at the busiest and most important time of year for most retailers.'
He also points out that retail firms can experience 50 per cent above normal sales in the post-Christmas period and should concentrate on serving customers rather than making price changes.
Earlier this month, the BRC called on the government and landlords to make efforts to stop shop closures, recommending cuts in the cost of retail rents, a total freeze on business rates and the reintroduction of empty property rate relief.
According to the British Retail Consortium (BRC), the government should delay the increase for at least one month beyond the current due date of December 31st, as this is the busiest period for stores.
The organisation says that it cost the sector around £90 million to temporarily reduce VAT from 17.5 per cent to 15 per cent and will cost a similar amount to carry out the restoration.
Stephen Robertson, BRC director general, comments: 'Changing VAT rates back to 17.5 per cent at the end of December will soak up a lot of effort at the busiest and most important time of year for most retailers.'
He also points out that retail firms can experience 50 per cent above normal sales in the post-Christmas period and should concentrate on serving customers rather than making price changes.
Earlier this month, the BRC called on the government and landlords to make efforts to stop shop closures, recommending cuts in the cost of retail rents, a total freeze on business rates and the reintroduction of empty property rate relief.
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