Bosses at the Co-op have been forced to defend price rises attributed to the VAT hike after they were queried by an Anstruther customer.
The shopper, who asked not be named, was shocked to find a loaf of bread at the store had rocketed from £1.23 to £1.40.
“Following the recent rise in VAT duty by 2.5% (it now stands at 20%) our local Co-op in Anstruther immediately raised prices,” he explained.
“Although this increase had been expected, the prices raised did not reflect the actual VAT increase.”
The customer insisted the price of cigarettes had also been hiked by more than the 2.5% he had expected.
When contacted a spokeswoman from the Co-op’s customer relations department admitted some prices had been increased by more than that associated with the additional VAT alone.
“We held off on cost increases regarding bread for as long as possible, but wheat prices have doubled over the past year,” she said. “This has been well- documented in the press.
“We have been under pressure from August to put up prices-all of the other retailers have put up the price of their bread.
“The cost we have taken on is actually more than we have passed on to the customer.”
The spokeswoman went on to say that the rise in cigarette prices was due to not only VAT, but also “ad valorem” duty and a specific tobacco duty.
However, the explanation bought little cheer to the Anstruther shopper.
“While I appreciate the explanation for the bread increase may go some way to explain the increase, I presume from the explanation regarding the cigarette increase that it is this dreaded ad valorem duty that is the cause of all our ills,” he said.
“And here was me thinking it was only a case of some retailers trying to increase their profits by using the VAT increase as an excuse to inflate their prices.”