VAT
Value added tax
VAT, or value added tax, is a tax added to most goods and services sold by VAT-registered businesses, and shop prices already include it.
What it means
GOV.UK describes VAT as “a tax added to most products and services sold by VAT-registered businesses”.1 The standard rate is 20%. Some goods and services are charged at 5% or 0%, and some are exempt.2
For a shop, VAT decides which price is which. The price a shopper sees includes it. Great Britain’s price marking rules define the selling price as the final price “including VAT and all other taxes”.3 Supplier price lists usually leave it out, because lists aimed at businesses only “do not usually include VAT, which is charged on top of the price shown”.4
Google asks the same of a product feed. Outside the US and Canada, its specification says to “Include Value Added Tax (VAT) or goods and services tax (GST) in the price.”5
Think of it like this
A shop handles VAT the way a cloakroom attendant handles coats. It passes through the shop’s hands, but it was never the shop’s to keep, and it goes on to HMRC.
For example
A price list shows a kettle at £25.00 ex VAT. At the standard rate of 20%, the VAT is £5.00, so the same price with VAT included is £30.00.24 On your product page, the shopper sees your own price, with any VAT already inside it.
Why it matters
Mixing ex VAT and inc VAT prices breaks the match Google checks between feed and page, and a product whose prices differ “may be disapproved”.6 Keep them in separate columns with the basis in each header, such as “Trade (ex VAT)” and “Price (inc VAT)”.
Sources
- GOV.UK. How VAT works: Overview.
- GOV.UK. VAT rates.
- GOV.UK. Price Marking Order 2004: government guidance.
- GOV.UK. Tax on shopping and services: Where you see VAT.
- Google Merchant Center Help. Product data specification.
- Google Merchant Center Help. How to fix: Mismatched product price.