John Brown
Freeloading Social media influenza
Show me an instance of anyone else changing their mind in these squabbles. Why single out Jacob?
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bansobaby
Accustomly titled
But the first sentence suggests that the bottom 20% spend more pro rata on high VAT rated items than the top 20%, which is quite simply a load of horse poo.
The second sentence is bobbins.... I never suggested that any one pays 2.5% VAT on anything, for a start i don't think that there is a VAT rate of 2.5% on anything, but I could be wrong.
For the last time:
Bobby Skint has £100.
He spends £80 on zero rated items such as food and rent. The VAT he pays is £0.00
He spends £15 on heating with VAT element of £0.71.
He goes out and spends £5 on a pizza in a restaurant. The VAT element is £0.83.
He is now skint again. His total payment of VAT is £1.54 or 1.54% of his original £100.
If you think that the above expenditure is wildly, wildly out of tune with what some people in this country have to deal with, then we will just have to agree to disagree....
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Reasoning will never make a man correct an ill Opinion, which by Reasoning he never acquired.
J. Swift.
John Brown
Freeloading Social media influenza
What? Has VAT gone up to 25%?
johna.clements
Established Member
I believe, maybe wrong, that it some places in the US it is illegal to display the full price.
I think the reason is political. In these days of computers and labels on shelves not products, for the most part, it is easy to display the price before and after tax. It is also easy to supply a receipt with the local, state and federal tax just like in the UK they have VAT displayed.
bansobaby
Accustomly titled
Well spotted, could you now recalculate the percentage paid by Bobby and make it wildly different to the 1.75%. You have 3 minutes....
bansobaby
Accustomly titled
Jacob
New Luddism. Wake up and resist.
Thanks for that but I have changed my mind as these threads progress. More of a change by learning process rather than an actual volte face. Really interesting digging out all these facts, figures and opinions.
Got led into reading the Communist Manifesto following a remark at one point. Very interesting but also quite brief. Highly recommended it's part of our political history whatever else you may think of it
Jacob
New Luddism. Wake up and resist.
Spot on! Bert Russell says something very similar but much less concise.
1000 idle thoughts here : TOP 25 QUOTES BY BERTRAND RUSSELL (of 1194) | A-Z Quotes
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well, it's not like we don't know what it is - you can calculate it, but we're used to that.
It doesn't apply to food or clothing and some other things (like toilet paper) in my state. It varies from state to state, both the rate and exactly how it applies.
Where it does apply, it's always the same rate - 6% in my state and +1% for the county where I live.
if you're operating a business and buying something to be used in a product you will later sell, you can get a "tax number" and not pay the sales tax on the assumption that it will be recovered in whatever you're doing. If you buy things at an antique shop here, they always ask if you have a tax number on the assumption that you may be buying stuff to resell.
as far as not affording things, it's not common for someone to use cash and say "oh, I'm short because of the tax". I've never actually seen it - it's not really that common to use cash for anything but small purchases now, anyway.
johna.clements
Established Member
The first sentence does not refer to the 20% or 5% it refers to the combined total spend 10% of disposable household income on VAT. I am not aware of a 10% VAT rate.
You referenced 2.5% of their expenditure on VAT.
The UK government states that the bottom 20% spend 10% on VAT. I do not know what the breakdown on the different VAT bands. Your belief that a disposable income of £850 only pays tax at 20% on £50 does not match reality.
You are of course free to post figures that do not match reality.
Bobby Government Figures has £100.
He spends £38.75 on zero rated items such as food and rent. The VAT he pays is £0.00
He spends £36.25 on 20% rated items such as chocolate biscuits. a light bulb, bus to the restaurant and beer for the nights in. The VAT he pays is £7.25
He spends £15 on heating with VAT element of £0.75.
He goes out and spends £10 on a pizza in a restaurant with a beer. The VAT element is £2.00.
He is now skint again. His total payment of VAT is £10.00 or 10.00% of his original £100.
If you think that the above expenditure is wildly, wildly out of tune with what is spent on average in this country as posted by the UK government then post your source.
if you go to the town square and one guy is there 19 times saying the same thing, maybe he's a cucumber farmer but all he wants to talk to you about is corporate taxes that apply to people who make cell phones, and he's really animated and insistent. And the 20th time a different guy shows up once, and then back to the first guy after that....
which one will people remember when they say they're tired of hearing from the cucumber farmer?
I don't think that it's some nefarious plan - I think at some point, someone decided that there needed to be some parity in illustrating costs.
When you go to the grocery store, some things are taxed and some are not. The things that are taxed may not be taxable to all (businesses, charities, etc).
In general, prices are always before tax.
Not sure how VAT works there - does everyone pay it at the exact same amount at the exact point of sale?
bansobaby
Accustomly titled
I will leave this to peer review if anyone can be pineappled.....
John Brown
Freeloading Social media influenza
johna.clements
Established Member
Yes everybody pays the same rate of VAT everywhere (I know Scotland can change income tax by 1%? do not know about VAT rates). I pay the same rate as a business or multinational company.
Businesses that are VAT registered can claim back the VAT that their suppliers charged them then charge it on the sale and have to pay the government the difference.
A wood working business buys £100k of materials, a machine of which 20% is VAT or £20k and makes tables which sell for £300k with 20% charged or £60k. The woodworking business has to pay £60-£20 or £40k to the government.
If a furniture shop bought the tables, plus a carpet for the shop for £400 plus £100k for the carpet (a very nice one) then sold the tables for £500k they would pay £100k - £60k on the table and -£20k for the overpriced carpet or £20k to the government.
Below a certain turnover you do not have to pay VAT on your sales but you can not claim the VAT back on the table and expenses.
OK, i've never seen it happen. Tax is 6-7% here, less some places, a little more others. You're imagining problems you might have if you didn't account for the fact that there will be sales taxes. People don't walk to a register here with something that they're not sure about.
More common is to see people buy 6 things and be short of one or two more than the tax amount because they didn't calculate anything at all, or maybe they were using the cashier as their courtesy adding machine. They just leave behind whatever they don't want on that trip and get it another time.
johna.clements
Established Member
I am sure people will debate if his money would have been better spent on plain digestives but most would view it as a reasonable "luxury".
on bigger business transactions, i don't know how it works here. My mother was a craft circuit person for 40 years. I do know for sure that she didn't pay sales tax on her supplies, but her buyers paid sales tax on the entire cost.
Which she end-arounded being problematic in person (mostly for change collecting reasons) by putting up a sign that said "all prices include sales tax".
There absolutely ARE state tax agents who pose as buyers at craft shows to see if you're charging tax, and they don't love that sign, but it's not illegal. They don't love it because they want you to make their job easy by saying "it's $10, we don't collect sales tax", which is not allowed.
When my mother did most of her selling, it could be fast paced at a fast show, selling $5-$20 items and sometimes $6-$8k in a weekend at the better shows. It was worth it to make the prices with tax a round figure and then go back later and back into the calculation of what was payable to the state tax authority, which they then did. Having change on hand for that kind of a volume is a real problem.
johna.clements
Established Member
Just as well your mother does not live in Nebraska. In the UK prices can be displayed without VAT but it must be made clear. Places that sell like that are normally selling to other business. Some display both.
Nebraska (from Revised Statutes of Nebraska):
“77-2703(1)(b)
It is unlawful for any retailer to advertise, hold out, or state to the public or to any customer, directly or indirectly, that the tax or part thereof will be assumed or absorbed by the retailer, that it will not be added to the selling, renting, or leasing price of the property sold, rented, or leased, or that, if added, it or any part thereof will be refunded. The provisions of this subdivision shall not apply to a public utility.
77-2703(1)(c)
The tax required to be collected by the retailer from the purchaser, unless otherwise provided by statute or by rule and regulation of the Tax Commissioner, shall be displayed separately from the list price, the price advertised in the premises, the marked price, or other price on the sales check or other proof of sales, rentals, or leases.”
