Apple Hikes Prices In UK Due To Increase In VAT

News | Wednesday December 29 2010 8:35 PM | Comments (0) Tags: , , ,

If you’re in the UK, you are probably aware that value-added taxes (VAT) have increased from today to 20 percent from 17.5 percent.
Apple had taken a downtime on its online store earlier today to increase the prices of its products to take into account the increase in the VAT.
The price increases have resulted in Apple straying from its usual price point targets, as an entry-level 13″ MacBook Pro or 21.5″ iMac that previously cost £999 with VAT now goes for £1020, while the entry-level Mac Pro price has moved from £1999 to £2041.
Popular iOS devices have also increased in price, with the 16 GB iPhone 4 rising in price from £499 to £510 and the 16 GB Wi-Fi iPad going from £429 to £439.
It looks like Apple has decided to pass the tax increase to customers to maintain its margin rather than absorbing the taxes to maintain the psychological price points. Apple had used the same strategy in New Zealand where GST recently increased from 12.5 percent to 15 percent.
Do you think Apple has taken the correct decision by increasing the prices or should it have absorbed the cost to maintain the psychological price points?

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