A rise in inflation for January is hardly going to shock anyone after the recent rise in VAT, but I wouldn’t be surprised if it took a bigger jump than most are expecting.
Many retailers and shop owners are using the 2.5% VAT increase as an excuse to raise prices further. Let me take you through an example of my experiences from one day last week.
I started out by visiting my barber early in the morning he was telling me how his rent had increased from £14,000 last year to £18,000 per annum. Now that’s an increase of 22%. At this point I was feeling sorry for him until I paid for my haircut and found that he’d had raised his prices from £9.50 to £12.50. That’s a 24% rise!
Later that day the sandwich man arrived, looking forward to a hot soup I handed over my £1.50. He told me that due to VAT and increased costs it was now £1.60 that’s an increase of 6.2%. I then popped next door to get a bottle of water and yes you’ve guessed it, the price had increased, this time from £1 to £1.10 this 10% increase was once again blamed on VAT.
Many of you will have seen your costs increasing from fuel to food and that’s why you are best placed to call a rise in inflation. So while the January figures may shock some we have already seen it coming.