Waitrose has not passed on last month’s VAT cut to customers but said it has instead invested the savings in price cuts across a smaller number of items.

The Government urged retailers to reduce retail prices in line with its 2.5% cut in VAT. Though most food products are exempt from tax, snacks and luxury lines attract the tax.

But while other supermarkets have adjusted prices at the tills – if not shelf-edge prices – Waitrose has not directly cut its prices, instead reducing staple lines.

“Our approach is to take a minor VAT reduction and convert this into a major saving for our customers,” said a spokeswoman for the supermarket. “We are passing on the full VAT saving by concentrating price reductions on several hundred staple lines customers buy on a weekly basis – including fresh produce.

“Customers will benefit immediately from permanent and deeper discounts on everyday products, independent of the 700 lines on promotion at Waitrose each month.”

Topics