UK VAT rose from 17.5% to 20% today. This means a whole range of goods and services will go up in price. The UK Government has introduced the tax rise in an attempt to raise £13 billion and close some of the £160 billion annual deficit it inherited from Labour.
The Daily Telegraph points out that many retailers will increase their prices by far more than the 2.1% net increase the tax rise should bring. It reports that many retailers will round up prices rather than round them down. It quotes examples of mobile phone tariffs going up by 10 and 20%. It also quotes the examples of Fitness first that has put up monthly subscriptions by 25% in some cases. I have personal experience of the Fitness First rise where a I received a letter informain me of 30%. I raised the matter with my local gym and have downgraded my membership in order to retain the old price.
