Traders see VAT cut as a burden and not a boost

Dec 3 2008 Surrey Herald

VAT has been cut by 2.5% but Surrey shopowners believe they are yet to feel the benefits as Rupert basham discovers

TRADERS say the decision by Chancellor Alistair Darling to cut VAT left them scrambling to reprogram tills and reprice stock.

The Chancellor announced a new 15% shopper-friendly level of VAT on November 24, which was to be implemented by December 1, to soften the economic downturn by encouraging consumer spending.

But being given less than two weeks to implement the change has left a lot of shopworkers feeling overwhelmed by the fact that they have to reprice all their items.

Tina Ford, owner of the Just Relish sandwich shop in Guildford Street, Chertsey said: "The Government doesn't seem to realise it costs money to redo our pricing and reformat our tills.

"It will cost me more than £100 to have my till reprogrammed and all for about a 4p saving on a pasty. It's ridiculous."

The Entertainer toy shop, in Two Rivers retail park, Staines, has elected to drop VAT on its items for a limited time, paying the difference itself.

Manager Tom Rowlatt, said: "We have gone VAT-free for a few days. It would have been a logistical nightmare to change all the prices, we've got over 5,000 items in store. We have got signs on the windows, and employees walking round the store helping the customers and explaining it to them.

"I think it would have been better if the Chancellor had taken it off income tax, then families would have had a couple of hundred pounds each."

Similarly, David Worsford, of Farrants newsagents in Cobham has decided to keep his prices the same, and give the 2.5% reduction to children's charity the Rainbow Trust and to Saidia children's home, in Kenya. "It's virtually impossible to get everything changed," said David,

"There is a lot of sympathy for retailers at the moment, there's a feeling that this will be ineffective. Customers have been quite supportive."

Pauline Hedges, of Spelthorne Chamber of Commerce said that there had been a lot of worried businesses approach them, especially about the time and cost of putting the changes into practice.

She said: "It's causing a lot of worry, especially at a time when businesses have a lot to worry about. It's been unhelpful."