Hardware prices should include VAT

[rpm]

Hardware prices should include VAT

Local PC hardware retailer taken to task for not including VAT on its advertised prices

 

[snail]

woohoo....not like it's gonna make a differance in our life, when i see "exc VAT" then i dont even bother continuing to read as i see it as a marketing strategy and therefore when i see that i ignore the company, therefore they lose me as a customer because they think their marketing strategy is clever, meanwhile it backfires for them

 

[Netguy]

Agreed - advertised prices of any commodity should include VAT to avoid consumers getting a wrong impression when doing comparative shopping.

 

[LazyLion]

woohoo....not like it's gonna make a differance in our life, when i see "exc VAT" then i dont even bother continuing to read as i see it as a marketing strategy and therefore when i see that i ignore the company, therefore they lose me as a customer because they think their marketing strategy is clever, meanwhile it backfires for them

+1 ... agreed! When I see those words "Ex VAT" I just stop reading. If they are willing to stoop to that kind of marketing, then they will stoop to anything. I can't trust them.

 

[zeely]

I can kinda understand both sides of the argument. Generally consumer pricing is accepted as being INCL VAT, but whenever you buy computer hardware from any distributor/supplier ALL their prices are excl vat. Its pretty much the accepted norm in IT industry that hardware pricing is excl vat...

 

[ben dover]

Who uses them anyway???
They need the business shame...

 

[nelwa]

Agreed - advertised prices of any commodity should include VAT to avoid consumers getting a wrong impression when doing comparative shopping.

I think it depens on your target market, when most of your clients are VAT registered, it's actually beneficial to display prices as excluding VAT.

 

[vodacom3g]

I think it depens on your target market, when most of your clients are VAT registered, it's actually beneficial to display prices as excluding VAT.

End consumers must be quoted VAT inclusive.

If you re-sell you can be quoted VAT-excl.

 

[Sackboy]

I thought I saw Lenovo doing it as well. Now I can't find the page!

 

[Shake&Bake]

I noticed yesterday that their site suddenly had VAT incl pricing.
Either way, they are still cheaper on quite a few goods then some of their competition.

 

[gregmcc]

I see they display both incl and excl - what for?

 

[Shake&Bake]

I see they display both incl and excl - what for?

Most of it covered in ic's post I reckon.
Perhaps there are those resellers whom would prefer to see the ex.VAT price.
Can't hurt having both up there I reckon.

Yep, wholesalers are allowed to quote VAT excl pricing to their resellers who should all be VAT registered and would therefore claim back the VAT charged by the wholesaler, i.e. the reseller pays the VAT inclusive price effectively minus the VAT that they claim back as an input VAT cost on their VAT return.

The dudes && dudettes 'in the street' generally are not VAT registered, and therefore would not be able to claim back input VAT, which requires that the pricing they see, is VAT incl.

 

[bekdik]

I see they display both incl and excl - what for?

A VAT enterprise does not include the VAT amount in its budgeting, so I guess it's easier to enter an ex VAT amount into a costing.

 

[InTheCube]

I've been buying most of my PC equipment from PC International for the last 5 years or so, and have found them pretty cheap compared to the competition on most of their products. I do know that they supply a lot of big corporate clients and possibly smaller retailers as well - maybe this is why their prices are listed excl. VAT.

I just bought about 25 grand worth of equipment from them last week, and so far I am very happy. The service I received was also good, with free delivery thrown in (I am 53km away from Randburg), and a further discount on certain items - so I have no complaints.

I don't think it's fair to say that they've mislead their customers by advertising a VAT exclusive price. All their prices explicitly indicate that VAT is excluded, and they do mention it to you over the phone as well. If they really wanted to mislead you, they wouldn't have done this, except possibly until payment time. In any case, they've ammended their website. But I do agree that showing VAT inclusive prices is a must.

 

[gregmcc]

I've been buying most of my PC equipment from PC International for the last 5 years or so, and have found them pretty cheap compared to the competition on most of their products.

I've compared their prices to some of the price lists I've got from Axiz/Rectrum - they aren't badly priced at all I must tell you!

 

[Drunkard #1]

Yep, wholesalers are allowed to quote VAT excl pricing to their resellers who should all be VAT registered and would therefore claim back the VAT charged by the wholesaler, i.e. the reseller pays the VAT inclusive price effectively minus the VAT that they claim back as an input VAT cost on their VAT return.

The dudes && dudettes 'in the street' generally are not VAT registered, and therefore would not be able to claim back input VAT, which requires that the pricing they see, is VAT incl.

The law is very clear on this topic. ALL prices MUST include VAT. The ONLY exception is "trade catalogues", and there are strict rules (which PC Int didn't abide by) regulating companies using this "loophole". Enforcement, on the other hand, is seriously lacking, and this has allowed a vast number of companies to abuse the public by breaking the law with impunity. It becomes a problem of "everyone else is doing it so why can't we". IMO enforcement should be stepped up, and every company which interfaces with the public should quote inclusive prices, in terms of the law. If those companies also supply corporates who require exclusive prices in their catalogues, these catalogues should be made available on special request only, and be correctly marked in terms of Practice note 3.

The comments in this thread show that pricing ex vat, isn't just illegal, but also offends a lot of potential customers and does more damage to a companies reputation than good. One day SARS will start enforcing this, and everyone will be better off.

Edit: If you're looking for other offenders to report, Mr Wiese, I can provide you with a long, long list.

 

[Tweak]

my brother who is a law student said that it's been illegal for a long time for companies to exclude vat in their adverts. But they stil keep on doing it.

 

[boramk]

woohoo....not like it's gonna make a differance in our life, when i see "exc VAT" then i dont even bother continuing to read as i see it as a marketing strategy and therefore when i see that i ignore the company, therefore they lose me as a customer because they think their marketing strategy is clever, meanwhile it backfires for them

+2

 

[HideInLight]

I'm actually glad someone complained. to me their site has now improved, saves me the hassle of opening the calculator everytime I want to see how much that specific product would cost me. Having both included also allows you to compare to rectron/sahara etc.

 

[Zenbaas]

I'm actually glad someone complained. to me their site has now improved, saves me the hassle of opening the calculator everytime I want to see how much that specific product would cost me. Having both included also allows you to compare to rectron/sahara etc.

Agreed. It was about time.