UK vs US pricing – do we pay too much?

UKVUS

Short of moving to the US, is there a way to get round the UK’s higher tech prices?

There’s a long-held perception that, compared with our transatlantic cousins, we tend to pay a premium for goods in the UK. If you’ve ever been on holiday to the States, you’ll probably have noticed the bargain prices of products compared with the cost of the same items back home.

Are we overpaying? We compared the costs of some of the most popular tech products to find out. We looked at several popular items from Apple, Sony, Google and others, as well as digital services including Microsoft Office and Adobe Creative Cloud.

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Do we pay too much?

Why the difference in price?

We asked the companies whose products we compared to explain the higher prices paid by UK consumers. Some, including Google, declined to comment. Others, such as Amazon, told us that there were ‘different operating costs in each country’, but couldn’t expand further.

Apple provided the most thorough answer, citing exchange rates, local import laws, business practices and taxes as explanations for regional price differences.

Are the differences justified?

While there may indeed be different operating costs from country to country, in some cases the price differences seem hard to justify. The 13-inch Apple MacBook Pro, for example, costs £1,499 on the UK Apple store. On the US site it’s £1,144 once tax is included.

We pay more tax in the UK, which plays some part in the price difference, but even with tax removed the MacBook Pro still costs over £190 more in the UK.

It doesn’t stop with physical goods, either. An annual subscription to Adobe’s Creative Cloud imaging software will cost you over £200 more in the UK. Other popular services, including Amazon Prime and Spotify, are also more expensive.

What can you do?

To take advantage of the cheaper prices in the US, you may want to consider importing. It’s worth doing the maths first, though – import duty, postage and taxes could soon swallow up any savings. However, get it right and you can certainly save some money.

Take the MacBook Pro as an example. If you were to import it to the UK, you could save between £100 and £150 pounds on the UK retail price, after fees.

Which? Expert’s View – getting fairer prices

Jack TurnerOne quick solution to fairer prices is to lower import duty fees. Currently, if you buy a product online from abroad the import duty threshold is £135. Buy it on holiday and it’s £390.

We’d like to see the government raise the threshold for goods bought online to the same amount, giving consumers more choice when purchasing goods.

As a long-term solution, negotiations are currently ongoing for a free trade agreement called the Transatlantic Trade and Investment Partnership (TTIP).

If it goes ahead, the TTIP could increase free trade and reduce conflicting regulation between the EU and US, ultimately resulting in more choice for consumers.
Jack Turner – senior researcher

You can read the full article in the August issue of Which?. If you have had any experience importing or buying abroad, let us know in the comments.

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18 replies

  1. There seems to be a certain absurdity in looking at price in the US as the sole justification on any view. If we get to the nuts and bolts of the situation then surely all the parts for computers are made and assembled in Asia.

    If Which? is really keen on the lowest price then can I recommend Brunei and setting up an export arrangement. The fact that local shops in the UK will go out of business , reducing jobs, taxation take, raising unemployment etc. is an entirely foreseeable result but not one Which? seems to be concerned about.

    Perhaps supporting UK based software houses and manufacturers they will get to the scale that allows them to compete better. …… and provides jobs other than in the service sector.

  2. I will be very surprised if Which are in support of the Transatlantic Trade and Investment Partnership (TTIP).

    From what I understand, if implemented it could cost the taxpayer £ billions where US multi-national companies are against UK and EU government policies.

  3. To be fair this particular article is not taking a position on TIPP I believe elsewhere Which? has said it is mainly in favour with reservations

    “Economic growth

    In a Guardian article of 15 July 2013, Dean Baker of the Center for Economic and Policy Research in the US observed that with conventional trade barriers between the US and the EU already low, the deal would focus on non-conventional barriers such as freeing up regulations regarding fracking, GMOs and finance and tightening laws on copyright. He goes on to assert that with less ambitious projections the economic benefits per household are mediocre “If we apply the projected income gain of 0.21% to the projected median personal income in 2027, it comes to a bit more than $50 a year. That’s a little less than 15 cents a day. Don’t spend it all in one place.”[57]”
    Wikipedia

    The loss of the EU to control GMO extensions , copyright etc make this a most unsatisfactory deal. It is fairly well understood that the US corporations are very poorly regulated with a revolving door policy between regulatory bodies and the corporations they are meant to control. Tying oneself to a country in a treaty with enforceable provisions such as corporations sueing national governments this is a very poor idea.

    I cannot understand why or how Which? has adopted a favourable stance without any refernce or explanation to its subscribers. Perhaps the August magazine will explain all. In Germany in May when some details were leaked 460,000 people signed a petition against it.

    1. I am looking forward to an explanation from Which? as to how and why they are giving their tacit support to the TIPP without consulting the members. Which? manages to find space to ask us about trivialities, like how we feel about ‘on-hold’ music, but it prefers to dabble in political issues, wrapping them up as technology and consumerism, without checking to see in whose name they are acting. It’s certainly not mine and, like dieseltaylor, I hope we hear more in the August issue.

  4. Readers looking for cheaper prices might also look at the prices in other european countries. There is no import duty, no customs delay and easy returns. After much searching i bought a samsung 12.2 tab pro from a mainstream german electronics retailer for £450 . Retail is £650 and the cheapest UK deal was £595 or so. Both Ebay and Amazon have a site for every major european country and it isnt difficult to work out what to click etc uK accounts are valid on these sites so ordering is easy.

  5. I recognise for general purposes of Which, TTiP must seem like a positive option but Which must take a look at the greater picture. TTiP will allow corporate giants to challenge any Government who’s rules and regulations they don’t like in private courts to enable them to gain greater profits at the expense and well being of the population of that country. There have been huge petitions sent to the EU in opposition to them signing this agreement. I think if Which suggest that it is a positive step, then it’s subscribers might find it difficult to swallow.

  6. I bought mine through an Amazon supplier fully covered by Amazon’s and Apple’s guarantee,and paid the US price of just over £800 for a MacBook pro retina 13″. (Inc. free postage) Apparently the £ may be a dollar sign and the keyboard an American one, but as I have only used Microsoft before I will be using a totally new system anyway, so not really bothered about the keyboard. I haven’t received it yet so too early to comment any further. The old adage does see to apply though; shop around! According to Mr Apple; who were exceedingly helpful when I spoke to them about this possible purchase, the £ symbol can be rectified with a bit of manipulation. PS I studied all the PC webpages for best laptops etc. as well as your own; all of which convinced me that this was the best laptop money could buy at this moment in time. Will let you know how I get on with it if you are interested in the future.

  7. I am one who has recently supported a petition against these negotiations. Corporate bodies have too great an influence over our governments and it would be totally wrong to grant them access to courts to apply greater pressures on governments. My view is that the EU negotiators should tell no no no.
    It is significant that these negotiations have been going on with little reference in the press or comment from Which!

  8. I too have supported a petition against the TTiP. The loss of sovereignty would be significant and the power granted to giant corporations would be dangerous. Which? Should be carpel when advocating support of such an agreement. There is a lot more at risk than price differences.

  9. I am amazed that a technology researcher feels he should be writing about international trade, of whose political implications he seems to be totally unaware. The fact that this article received editorial approval makes me wonder if I am subscribing to the wrong journal.

  10. I can’t see what the fuss is all about, once the Eurocrats get their hands on the treaty, TTIP will soon become TITSU,’
    Jim Hawkins, aaarrgh.

  11. So what’s new? Many years ago we wanted to take some British-made gifts for friends when we visited them in USA. Not being a lot of choice we took Wedgewood chinaware, and were dismayed when we found the same items for sale in Boston for the same number of dollars as we paid pounds in London. In general we have found most things are cheaper in America.

  12. The current edition of QUICKEN by Intuit cannot be bought even through AMAZON. If you do not have a USA address and do not have a USA credit card.

    If you have a friend in the USA you might persuade him/her to get one and send it to you. The USA dealer did not know why it was not available to UK citizens.

    Intuit in the UK do not sell QUICKEN and expect you to buy QUICKBOOKS instead.

  13. Try buying tech products in Spain – many things are much more expensive than in the UK often down to the lack of competition between both online and high street retailers.

  14. I Lived in USA for 12 years and 15 years in Spain and I agree about the financial differences, not only in the States but also in Spain. Returning to UK I was amazed at the disparity .Even in Spain technical goods could be found cheaper than here in UK.

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