Many of us will typically not notice value added tax (VAT) on things we buy.
After all, you’ll often find that this type of tax – which is paid on most types of goods and services – is incorporated into the price you see on the label, so you rarely have to think about it.
But what exactly is the UK VAT rate, and what products does it apply to?
Here’s everything you need to know.
How much does VAT usually cost in the UK?
Currently is standard VAT rate in the UK is 20%.
This is true for most goods and services, but some items have a reduced VAT rate of 5%.
Most food, along with clothes for children, has 0% VAT.
Stamps and real estate transactions are completely exempt from VAT, says gov.uk – while tobacco, alcohol, petrol, other fuels and insurance are instead subject to different types of tax.
If you are curious about purchasing fees, you can visit gov.uk’s dedicated page for more information.
PS The standard VAT rate has been 20% for more than a decade now. Previously, it was 17.5%, but increased on January 4, 2011.
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