Etailers managing so far to dodge the impact of the VAT rise

The VAT rise in January appears to have left etailers largely unscathed with the majority reporting sales have remained as expected through the first quarter. The hike to 20% in VAT earlier this year was seen by some as having dire consequences for a retail sector already hit by recession and a dip


The VAT rise in January appears to have left etailers largely unscathed with the majority reporting sales have remained as expected through the first quarter.

The hike to 20% in VAT earlier this year was seen by some as having dire consequences for a retail sector already hit by recession and a dip in consumer confidence.

But figures from SecureTrading indicate that 10% of online merchants have seen sales exceed expectations and 55% report that they are in line with their expectations.

Half of those etailers surveyed have swallowed the VAT rise themselves deciding not to pass it onto customers but 20% have indicated that they cannot continue to follow that policy and will pass on some of the costs to users.

"Online merchants are continuing to perform strongly despite the current economic challenges," said Tim Allitt, head of sales and marketing at SecureTrading.

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