Business owners prefer paying VAT rise to losing clients

MANY Almeria business owners will not raise VAT (Value Added Tax) on their wares to keep clients. According to local business associations, the Government tax raise that will come into effect on September 1 will be paid for by many shop owners in an attempt to keep dwindling sales from diminishing any further. 

The head of the Small Business Defence Platform (Pladeco), Antonio Asensio, stated that despite this effort, the new VAT rises will be ‘bad’ for all establishments. For this reason, local businesses have also been purchasing this year’s stock ahead of time to avoid having to pay more later on. The VAT increment will affect some businesses more than others; for example florists will see a 13 per cent VAT rise, which could cause 40 to 45 per cent of florist shops to close, estimated a recent floral industry report. Also, hairdressing expenses will go up drastically, as they are considered luxury services, while school supplies will no longer be considered basic necessities, meaning that many items will go from four to 21 per cent VAT. Some traders are waiting to see if recent protests will affect the Government’s decision to raise VAT percentages, while others prepare for the storm and hope the reduced profits will not crush their businesses.