Retail groups welcome consultation on re-pricing extension

Retail groups have welcomed news of a possible extension to January's VAT re-pricing period.

The Government today announced that it will consult on an amendment to the Price Marking Order, which would extend from 14 to 28 days the time retailers have to re-label items when VAT returns to 17.5%.

Retail groups have previously expressed concerns that the reversal of last December's VAT cut to 15%, scheduled for 1 January 2010, would come at the "worst possible time" for retailers.

"This is a welcome indication that the Government could give retailers the extra flexibility we've been calling for," said Tom Ironside from the British Retail Consortium. He warned that a situation where customers were asked to pay more at the till for under-priced items "could be more difficult than last December's reverse scenario".

"Re-pricing tens of thousands of items is a mammoth and costly task and it has to be done during most retailers' busiest and most commercially important time of year - a time when staff should be focused on serving customers."

Chief executive of the Association of Convenience Stores, James Lowman, urged the Government to "follow through on this consultation" to ensure that retailers "aren't unfairly penalised" during the re-pricing period. However, he also repeated the association's call to delay the changeover of the VAT rate to 1 February 2010.