Blame the government apparently...

chriscuk18

I’ve just had a very weird experience in a local “Nisa Local” shop in Leeds, something that I’ve never heard before in any other shop, even the small corner shops.

I went into the shop to buy a drink, groceries and some cigarettes.

My Transaction total was £8.53, and went to reach for my wallet to pay with a debit card. The merchant then said because you have bought cigarettes there is a 50p charge for using a debit card or credit card to pay. I instantly thought oh he means because I’m using a debit card and its less than £10 or something (which I know is fair its up to the merchant what he charges for debit/credit cards), This I’m kind of used to hearing with working in the city centre lots of local places insist on a small fee for processing a credit or debit card.

Then I realised that the sign said transactions LESS than £5 will be charged 50p, unless you have bought tobacco/cigarettes when a 50p charges will always be added.

I instantly thought this out of order just because I had cigarettes in my transaction he will charge an extra fee – I quizzed the merchant on this as I myself work in financial services and never heard of a shop charging payment processing fee’s back to the consumer based on what type of goods they buy, not the overall transaction value.

When I asked the merchant why this is, his response was “Oh – Don’t blame me, blame the governments it’s them who make us charge it” – To this I thought absolute non-sense the government already have their cut in terms of taxes before he even sells on the cigarettes.

Is this right? – Can he actually decide what transactions have an extra “Item Tax”?

What are your views on this? (Please don’t turn this thread into a “you shouldn’t smoke/you deserve it”)

I am really concerned about all the 50p’s this guy is making and blaming the government for his financial gain? –

jezza2412

Surely that's complete nonsense and he's pulling a fast one. If it was really a Government charge it wouldn't be payable on card transactions only. Plus it would be in the form of tax included in the price, not a separate charge...

geordie_joe

I suppose he can charge what he likes for using a card, but collecting tax and not passing it on to the tax man is probably a very serious offence.

I would report him to the tax office

He's just trying it on, he knows that if he did it for other items people would just not buy the items, but if you smoke you have to have your fags and will pay the extra 50p to get them.

As I said, I would write a strong letter to the tax office telling them he is collecting extra tobacco tax on their behalf and that you don't like it.

I would also write a similar letter to nisa head office, as I suspect they don't know he is doing it. I doubt they will be happy with him collecting a non-existent tax.

Jojo_the_Tightfisted

Credit card companies make their money by charging a percentage of the purchase value as a fee. Shops absorb this cost, around 3.5% as I remember, rather than charge the customer extra for all but the smallest transactions, under £5 for example.

However, if this were applied to cigarettes, they would fall foul of various VAT and Duty rules as it probably comes under selling fags for a discount or something. He would have been instructed either by Nisa or the IR/his accountant of the position.

Which means that the exact details may have been a little lost in translation. The fee still goes through the accounts for the shop, so there is nothing dodgy there, either.

geordie_joe

Jojo_the_Tightfisted wrote: »

However, if this were applied to cigarettes, they would fall foul of various VAT and Duty rules as it probably comes under selling fags for a discount or something.

I can't see how ADDING 50p to the price of a packet of fags comes under "selling fags for a discount or something"

Jojo_the_Tightfisted wrote: »

He would have been instructed either by Nisa or the IR/his accountant of the position.

Or he may have done it off his own bat just to increase his profits because Nisa are on his back for not making enough.

Jojo_the_Tightfisted wrote: »

Which means that the exact details may have been a little lost in translation.

Or the details may never have been passed on, because it was all his idea. Or did Nisa/IR etc. only instruct him to do it and not the other Nisa shops?

Jojo_the_Tightfisted wrote: »

The fee still goes through the accounts for the shop, so there is nothing dodgy there, either.

The dodgy part is him making the charge and claiming the government instructed him to do it.

ManAtHome

Probably more to do with low margin on ciggie sales - may have got fed up losing money taking cards for one or two packs, and doesn't want to pee off other customers by raising the minimum spend to £25 or so.

Enterprise_1701C

I work in Martins' - I've never been told to add 50p to card transactions for cigarettes!

hippey

Or as I suspect his profit margin is very low for these its and he is (wrongly) passing on the card processing fee.

Strictly this is against the T&Cs he will have with his bank, but you have an option to vote with your feet if you don't like it. I suspect the shop assistant was just fed some BS to pass on to any customers who complain.

Credit Cards are charged at a percentage, where as Debit cards are a fixed fee regardless of transaction amount.

jb66

You shouldnt be smoking anyway

geordie_joe

jb66 wrote: »

You shouldnt be smoking anyway

Why not???

Shiggaddi

hippey wrote: »

Or as I suspect his profit margin is very low for these its and he is (wrongly) passing on the card processing fee.

Strictly this is against the T&Cs he will have with his bank, but you have an option to vote with your feet if you don't like it. I suspect the shop assistant was just fed some BS to pass on to any customers who complain.

Credit Cards are charged at a percentage, where as Debit cards are a fixed fee regardless of transaction amount.

I believe credit cards also have a fixed fee, the same as debit cards, but then credit cards charge the percentage as well. That is why they have a minimum amount for both.