Budget: Garden centres brace themselves for VAT increase scheduled after Christmas

The garden centre industry is facing up to the VAT increase. Leading retail figures said higher taxes not coming in until after Christmas was the best they could have expected.

HTA president and Scotsdale Garden Centre managing director Caroline Owen said the rise from 17.5 to 20 per cent scheduled for 4 January was predictable: "We're not happy with it but it will give retailers time to organise themselves. It won't impact on Christmas and stock that has already been ordered and pre-priced. The changes have been well thought out. I won't know whether it will impact on sales. Maybe if people cut spending on larger items they will spend more on the garden."

The hike will damage garden centre trade, said Garden Centre Association chairman elect Dennis Espley. "More VAT will take money out of people's pockets. We're just going to have to live with it - there's nothing you can do," he added.

But Young Plants managing director Alex Newey said: "As business-to-business suppliers we are less affected - most of our customers will claim back the VAT anyway. But the worry will be for wholesalers supplying retailers. Will they pass on the VAT increase to their suppliers?"

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