Cutting VAT on bike repairs (and others) - great idea from Sweden?

[GrumpyGregry]

https://www.theguardian.com/world/2016/sep/19/waste-not-want-not-sweden-tax-breaks-repairs

They've have cut the rate on repairs from 25% to 12%

The incentives are part of a shift in government focus from reducing carbon emissions produced domestically to reducing emissions tied to goods produced elsewhere.

Good idea or waste of time that won't stimulate demand for repair?

 

[JtB]

Wasn't VAT introduced when we entered into the Common Market? In which case surely it will be abolished all together when we exit the EU

 

[midlife]

I'm old enough to remember purchase Tax

Shaun

 

[raleighnut]

Is 'servicing'/repairing a bike a 'Luxury' which is what VAT was supposed to cover.

 

[Drago]

Won't make me suddenly go to the LBS for spanner work. It could be free and I'd still rather do it myself.

In my experience people either have the inclination and skills to do it themselves, or they don't.

 

[I like Skol]

Won't make me suddenly go to the LBS for spanner work. It could be free and I'd still rather do it myself.

In my experience people either have the inclination and skills to do it themselves, or they don't.

I think you are missing the point. I suspect the reduction is to sway the new bike/repair old bike argument rather than affecting any DIY v LBS decisions?

 

[winjim]

Is 'servicing'/repairing a bike a 'Luxury' which is what VAT was supposed to cover.

Have you been listening to the tampon tax debate by any chance? VAT isn't a tax on luxury, it's just a tax on stuff.

ETA: Cutting tax on bike repairs is a nice idea though, a little nudge in the right direction which is one of the roles of the tax system.

 

[raleighnut]

Have you been listening to the tampon tax debate by any chance? VAT isn't a tax on luxury, it's just a tax on stuff.

ETA: Cutting tax on bike repairs is a nice idea though, a little nudge in the right direction which is one of the roles of the tax system.

It was supposed to be a tax on luxury goods but the scope of 'the dreaded' was widened by successive governments to where it is now.

 

[winjim]

It was supposed to be a tax on luxury goods but the scope of 'the dreaded' was widened by successive governments to where it is now.

Do you have any evidence for that assertion? I only ask because I got involved in a few arguments about it last year, and I could not find anything to suggest that VAT is or ever was intended to be a tax on luxury.

 

[winjim]

It is the reason for the convoluted rules on chocolate biscuits etc.

Evidence? Something official with the word luxury in it?

 

[Drago]

I think you are missing the point. I suspect the reduction is to sway the new bike/repair old bike argument rather than affecting any DIY v LBS decisions?

I don't think i've missed the point. I can understand the rationale for doing this, I just don't think that it's going to make a significant impact numbers wise on those wanting spannering services at their LBS. I'm happy to be proven wrong in the fullness of time, but I reckon the NET difference will be as close to zero as makes no odds. Therefore, the knock on impact of those nursing along an old bike instead of buying a spangly new one is also liable to be zero.

 

[GrumpyGregry]

I don't think i've missed the point. I can understand the rationale for doing this, I just don't think that it's going to make a significant impact numbers wise on those wanting spannering services at their LBS. I'm happy to be proven wrong in the fullness of time, but I reckon the NET difference will be as close to zero as makes no odds. Therefore, the knock on impact of those nursing along an old bike instead of buying a spangly new one is also liable to be zero.

You make a good point. So far as I could tell, when there, utility cyclists, in Sweden, and Demark, don't do their own spannering, they take their bike to the lbs for everything, and at least one colleague bought a new bike rather than getting some trivial repairs done on her old one.