The implementation of “Buy without VAT” which involves a 21% return in purchases made with a debit card, the cash discounts in some stores to encourage the consumer not to use the card. This is because it takes up to 48 hours for the payment to be credited to the merchant.
In this framework, a report prepared by the IARAF tried to raise awareness that up to an accumulated consumption of $89,500 per month, the only cash discount that competes with the “Buy without VAT” It is one higher than 21%.
In any case, the only correct way is to make a formal purchase, regardless of whether it is in cash or with a card.
Given the tax burden, the seller has a high incentive to sell informally, which leads to discount offers for cash payment.
With the “Buy without VAT” a consumer who pays with a debit card has a 21% return (refund) in a maximum period of 48 hours. If you pay in cash, the discount should be greater than 21% to be the best option.
Buy without VAT: When is it convenient and when is it not?
However, the “Buy without VAT” program has a monthly refund limit of $18,800. Therefore, once the consumption of $89,500 with debit card in the basic basketany level of cash discount against the option of payment by debit card.
The following table presents a summary to facilitate the understanding of these two options. This example assumes a cash purchase discount of 10%, which is common at this time. This is a consumer who consumes $10,000 per purchase throughout the month.
As explained by the IARAF, it is possible to observe that when faced with a consumption of $10,000 the purchase is more convenient via debit card, since the refund of $2,100 is a 110% greater than the cash discount of $1,000. This difference is maintained until the accumulated monthly consumption of $90,000. From this amount of accumulated consumption, it is convenient for the consumer to consume each extra peso of consumption in cash, because the refund of the “Buy without VAT” has a limit of $18,900 and was consumed with $90,000.
The majority of people who benefit from the “Buy without VAT” have a consumption of these goods within the established limit. Given the alternative of a cash discount, which gives the buyer a discount of $9,000 on $90,000 consumed, the alternative of“Buy without VAT” means one of $18,900 on $90,000 consumed.
The proliferation of discounts payments in cash reflects the search for a sale in informal terms. Given the validity of the “Buy without VAT”, the consumer obtains a significant 21% refundwhich leads to the cash discount offered to encourage you not to use the debit card must be older.
Source: Ambito
