jon81uk
TS Member
But companies can claim VAT back so how does a reduction benefit them if they do not pass the reduction onto the customer? I was under the impression the cut was for the consumer, so it'll entice people to book those holidays, take days out etc. That would then benefit the leisure companies as they'll be getting more revenue.
Or am I missing something regarding VAT and the leisure/tourism industry - I'm no business expert - can companies claim back all VAT or just on certain products and services?
The company can choose if they want to keep the additional income or reduce prices. But of course customers will decide whether they still want to buy the product with no price reduction.
Not sure what you mean by claiming back all VAT.
On the AT ticket price, of the £58, the ticket was £48.33, so the government got £9.66 with old 20% VAT. With the new VAT the £48.33 with 5% tax would be £50.75, so if they are selling at £53, they are now making more money. £53 without 5% tax is £50.48, so Alton Towers are getting about £2 extra per ticket.
The government gets £2.53 now (on a £53 ticket at 5% VAT) instead of £9.66 last week on a £58 ticket (with 20% VAT).
Alton Towers gets £50.75 on a £53 ticket with 5% tax and last week got £48.33 on a £58 ticket (with 20 % VAT),
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