Kevin Reed, Accountancy Age, Thursday 14 October 2010 at 09:33:00

Survey for HMRC finds impact of previous VAT increase to 17.5% was as much asthe earlier decrease to 15%


New figures refute suggestions that the increase in VAT in January 2010 costless to implement than the earlier decrease.

More than three quarters of businesses believe the VAT increase to 17.5% hadthe same time and cost impact as the earlier decrease to 15%. This is despiteearlierestimates which suggested the lessons learned from the decreasewould mean the shift back up to 17.5% would be less onerous.

The ORC Internationalsurvey, on behalf of HM Revenue & Customs, found that 43% of largebusinesses thought the cost to increase VAT was higher than the previousdecrease: only a third saw a similar cost.

More than half of respondents said there was nothing that the government orHMRC could do to help them prepare for the future rate increase.

Smaller businesses were more likely than larger businesses to say they feltthe information they received at the time of the decrease in December 2008.

Four fifths of respondents want at least four weeks' notice for future ratechanges.

Further reading:

Overview:Derek Allen, VAT's going on?