If a vat increase is announced in the budget next week, and my car came after the increase , would I be liable for the extra vat? even tho I have signed a contract and paid a deposit at current vat rate. Thanks
The same question has crossed my mind as well, as a new car that I am buying for one of my daughters has just arrived in the U.K. and we should be taking delivery next month. The Chancellor is saying that “everyone will have to pay more tax” and as a lot of people don’t pay income tax, that does rather point to VAT. I guess it would also help inflation, if not the cost of living crisis!
Part of the reason that I ordered the car at the end of September was that I was concerned that if the manufacturer applied an inflationary price increase it could add a few grand to the cost of the car. I specifically asked the dealer what would happen if there was a price increase prior to taking delivery, and he assured me the price that we agreed, including the negotiated discount, was guaranteed. I guess they could argue that VAT is a separate tax that is beyond their control, but I would still expect them to honour the price that we agreed, given that the price that we shook hands on wasn’t an ex-VAT price, it was including VAT. I would anticipate them trying to pass on the extra tax though, as it would probably wipe out any profit they make on the car.