It’s great to see Governments can act quickly when they want to. The UK Chancellor has just announced that VAT will be cut from 17.5% to 15% effective from 1 December 2008 as an early Christmas present for consumers in the United Kingdom.
The main component is the well-trailed cut in VAT from 17.5 per cent to 15 per cent from Monday, which will expire in 2010. It is the first time that standard VAT has been cut across the board since it was introduced in 1973.
To support this change, we’ll be adding support for 15% VAT from 1 December 2008. To make the change smoother for users, we will leave the existing default tax rates and allow users to manually choose the 15% rate.
If you want to make 15% your default from 1 December, you can update your chart of accounts and change the default tax code. You might also want to check any repeat invoices that you have and change their tax rates to the 15%.
It’s not just a Christmas present for UK consumers of course …