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Traders hope to reap VAT boost 12.01.11

by Eamonn MacDermott, Inishowen Independent

INISHOWEN businesses are hoping for a boost this year with the increase in VAT in the North from 17.5% to 20%.
The VAT increase came into effect last week and, combined with the exchange rate, it is thought it could result in a sales boost for businesses locally.
While food sales are exempt from VAT other goods such as electrical can be affected by changes in the VAT rate.
John Gill of Irwin Electrical said they were hoping to see an increase in trade with the new VAT rate in place.
He said: “We would be hopeful that the VAT increase in the North will benefit the likes of us in two ways.
“Firstly we would hope to get more trade from local people who in the past might have gone to the North. Now it makes sense for people to shop locally.
“Secondly we would also hope to see an increase in trade coming from the North as
John Gill of Irwin Electrical says Northern VAT hike should boost Inishowen trade.
this increase will make goods down here more competitive.
“Combine the VAT rise and the exchange rate for sterling and things could look up for trade here.”
John added: “We have been lucky enough in that trade has been holding up recently.
“We were really busy in the run-up to Christmas. Some of this may be accounted for by the weather forcing people to stay and shop locally but either way trade was good.
“So we would be hopeful that we can go on holding or own and maybe get a bit of a boost from all the changes going on.”
Combined with the rise in VAT, Inishowen businesses are also well placed to take advantage of a rise in fuel costs.
From last Sunday an extra 0.76p was applied to a litre of petrol and diesel in the North. A further 1p in duty will be added to a litre of fuel in the North from April.
This should spell good news for Inishowen garages and ensure that the cross border trade continues.
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