VAT Rate Reduced to 15%

1 December 2008

On a temporary basis from today, 1st December 2008, to 1st January 2010, the standard rate of VAT will be charged at 15% instead of 17.5%, as announced in the Chancellor of the Exchequer’s Pre-Budget Report.

The Government’s fiscal policy may be a welcome step for consumers but the hasty implementation of the measure may lead to increased administration for businesses in respect of altering prices.

However, it should be noted that anti-forestalling legislation is in place to prevent businesses exploiting the VAT rate changes.

Should you require further information see HM Revenue & Customs: Pre-Budget Report 2008 - VAT Rate Changes

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