2.5%

Hello everyone, long time no see. I’ve had a few weeks off from blogging as I’ve had no interest in writing anything, you know how it goes..

Anyhow, today the powers that be, I hate to call them a government as they don’t know how to govern anything, have inflicted upon this nation an increase of 2.5% on the value added tax we have to pay. For those of you who can’t do the maths, this means we now pay 20% VAT on practically everything we buy.

I won’t go into how absolutely stupid this is at this time, we all know how an increase in VAT will effect the economy in its current predicament, namely, no bastard will go out and buy anything because its too expensive, at a time when consumers should be encouraged to go out and spend. I’ll also not mention the pledges made by those people in power during election time that they would never increase VAT, but we all know how politicians operate, if there is a small boy to be buggered a bit more, those Tories will whip down his pants a bit further and roger the blood out of his stomach if it is indeed possible.

So we’re now in a position where wages have been frozen, if not reduced, hours cut taxes raised, one should feel the pinch a bit more.  It’s only 2.5% though isn’t it. Well, yes it is, until the retailers round it up to the nearest 99p. So in real terms we will either be paying through the nose for something or we will be getting less for our money, or even the quality of the product will decline. Makes me mad it does!

Lets look at a couple of areas where the extra 2.5% will hurt many of us the most. Petrol and alcohol. 

I noticed that people are now paying around £1.25p for a litre of unleaded in the forecourts today, for the benefit of our friends in the US, that’s around $6.25 a gallon! No wonder we have small cars eh?

Obviously the knock on effect of this is transport costs, which the consumer will have to pay for, so in fact, you will not only be paying the extra 2.5% VAT but you will also be paying for the extra costs involved from production to distribution. All this time Mr. Taxman will be raking in his extra 2.5% from each source so by the time it gets into your hands at home you will have paid something closer to the price of a kidney rather than the extra 6p you were expecting.

Lets look at booze, I currently buy John Smiths, the cheapest bitter the local pub provides at £2.80p a pint, this should increase to around £2.87 today. However I will not be surprised to find that the same pint will be around £3.10. Having run a pub or two in my past, this is the price break I would have aimed for to make any profit. Scary isn’t it.

I’m sure that many retailers will not be able to take upon the additional increase in VAT themselves as margins are extremely tight in todays market, so guess who will be paying.

On a lighter note, I have decided that I’ll now be drinking petrol instead of John Smiths, I’ve been assured that the effect is quite close to drinking rough cider, in that it gets you high and makes you shit your pants, but when you look at the cost saving you make between petrol and beer, it makes sense to go for a night out at Shell’s forecourt rather than the luxurious surroundings of the local bar. Just think, two litres of unleaded costs £2.50, the same amount in John Smiths would set me back £12.40! There is only one winner really… Not me, Mr Taxman.