By the time you read this the VAT increase will have been well and truly bedded in. The very first day of the new increase generated plenty of news reports, each aiming to explore the impact on various people and sections of society.
Needless to say the politicians took it as a time to score points off each other, with the coalition government maintaining they had made the right decision to increase it by 2.5%. It was also mentioned that the chances were good that the increase would be a permanent one.
But the public opinion about the VAT increase seems to be split down the middle, just as it is among all parties and politicians. Some people are disgusted with it and disagree with having to pay more for goods and services. Others meanwhile are content with the increase, knowing that the government must act to reduce the huge deficit it was left with once the previous government left.
There is a certain amount of flexibility with the increase of course. Since we decide what goods we want to buy, we have a choice in whether we will buy certain things or not. But in contrast we will also have no choice about certain things that VAT is added to, so there is only so much wiggle room in this respect.
There have also been concerns over whether some retailers might be unfair over increasing their prices. In theory 2.5% should be added to all those items that are relevant. But in fact some have voiced concerns over retailers adding more than this amount to the sum. In order to get goods to end in the famous 99p, it is possible that some will add far more than 2.5% to make this happen.
In the end we must wait and see how things develop over the next few weeks, as more stores change their prices. Some have said they are not passing on the increase straightaway. Others are simply waiting to see who makes a move first, before following on behind. It would seem in some cases that no one wants to be the first store name to make the increase, so it could yet get rather interesting.
There will doubtless come a time when we have forgotten all about the increase. But for the moment it is definitely high in everyone’s minds.