VAT hike hits Apple prices in UK

Editor’s Note: The following article is reprinted from Macworld UK. Visit Macworld UK’s blog page for the latest Mac news from across the Atlantic.

VAT rose from 17.5 percent to 20 percent on Tuesday in the UK and prices in the UK Apple Store have risen accordingly.

Now you'll have to pay at least £439 to get your hands on an iPad from Apple, up from £429, and the cheapest iPhone 4 will cost you £510, up from £499.

Macworld UK’s predicted price rises were proved to be accurate, with Apple seemingly not taking the opportunity to adjust prices further to bring them into line with international markets.

It is hoped that the rise in VAT in the UK will generate £13 billion for the country’s beleaguered economy but many experts predict that it will lead to a slump in the retail sector.

Many people looking to get the best possible deals flooded online retailers during the last few days of 2010, according to analysis from Hitwise.

However, one Macworld UK reader trying to access the Apple UK Store on Monday evening reported that the site was offline. Apple has not yet confirmed this.

Anyone looking to get an iPad in the UK without paying the new rate of VAT would be well advised to look to the mobile operators. Orange is still offering the 16GB model with 3G and Wi-Fi for £199, providing you sign up to a 24-month, £25 per month data plan. T-Mobile and Three are also offering similar deals.

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