Question

In January 2011 the rate of VAT increased from 17.5% to 20%

work out the difference in price of a car worth £15000 +VAT due to increase in VAT
Please can u help me on this for 15 points thnxs

Answer 1

Difference between in price of a car due to increase in VAT is $375.

Explanation:

Since e have given that

Price of car = $15000

Rate of VAT = 17.5%

So, Amount of tax becomes

So, Total Price he has to pay is given by

but According to question,

Rate of VAT = 20%

So, Amount of tax becomes

So, Total price he has to pay is given by

Difference between both the price due to increase in VAT is given by

Hence, difference between in price of a car due to increase in VAT is $375.