iPhone 40, GST, contracts. Should vodafone be allowed to move me to smart1 plan?

Forums › One New Zealand (including Vodafone, WxC, Farmside) › iPhone 40, GST, contracts. Should vodafone be allowed to move me to smart1 plan?

sxz

761 posts

Ultimate Geek

#71870 18-Nov-2010 21:39

Mid September I entered into an iPhone40 plan. Via the Internet, so I could get my iPhone 4. I'm sure lots of you did.

I read the t&c's thoroughly.

It specifically said 24 month term at 40 per month. Not 30something plush GST.

I am sure vodafone has no right to change me to a smart1 plan 2 weeks later when GST increases. Hey, 85c per month, I know. But seriously. Contract law 101. Fair trading act and GST act.

They have no right to change my plan Winford my consent do they?

Am I being a grumpy old man?

Certainly the woman I spoke to on the phone was incredibly rude and would not listen (nor understand, I suspect).

My point is vodafone was well aware GST was increasing, 2 weeks before the increase I sighned up to a 40 a month commitment for two years and they now bump the price. What's to stop them doing it with other costs imposed on them?

Thoughts?

Zeon

3916 posts

Uber Geek

Trusted

#406463 18-Nov-2010 22:07

Can you post the contract on here?

Speedtest 2019-10-14

johnr

19282 posts

Uber Geek
Inactive user

#406468 18-Nov-2010 22:16

All that changed was the plan name nothing else. Yes we can change the name of the plans with out customers consent.

You still get the extra 3 gig and 1000 PXT at no extra cost

The rest was just GST if you have a issue with this best speak to the IRD or the government

GST may have gone up 2 weeks later but if Vodafone had put up GST 2 before hand what would have happened

You must of known GST was going up! I sure did and I also knew I was getting a tax cut

Thanks John

ChrisNZL

309 posts

Ultimate Geek

#406509 19-Nov-2010 00:07

The "40 per month" would've included GST, so that's $35.56 excluding GST (taking off the old rate). Blame the government for making you pay extra GST, not Vodafone.

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itxtme

2102 posts

Uber Geek

#406583 19-Nov-2010 09:15

The GST Act allows a supplier to increase their prices on existing agreements or contracts to compensate for the associated increase in GST (ie 2.5%), for example:
car parking contracts
gym contracts.

http://www.ird.govt.nz/changes/gst/consumers/

graemeh

2078 posts

Uber Geek

#406589 19-Nov-2010 09:27

sxz: Contract law 101. Fair trading act and GST act.

Law 101, you can't have a contract that says anything different to the law unless the law says you can (i.e. that you can contract out of the law).

sxz

761 posts

Ultimate Geek

#406603 19-Nov-2010 09:50

Thanks for the replies you guys.

Zeon - I was never given a contract. Just downloaded the T&C's from the website.

Johnr - it has changed - marginally. The old price was $40 including gst it is now $54.46 + GST which ChrisNZL kindly calculated for me. Subtle difference I know, but as you will no doubt be aware there are clear differences under the GST act and fair trading act as to whether a product is advertised as including GST or + GST

ChrisNZL - you are right. I in fact do agree with the increase of GST.

itxtme - thanks for that man. I have also found another snippit here: http://taxpolicy.ird.govt.nz/publications/2010-sr-budget2010-special-report/gst-rate-increase

seems to shoot down my arguments in one, specifically:

"Contract prices (clause 51)
Some commentators have suggested that there is interpretative uncertainty over whether contract prices expressed as “inclusive of GST” can be increased by the amount of the GST rate increase. Given that many contracts will be expressed on a GST-inclusive basis, this issue should be put beyond doubt by amending the relevant section of the GST Act. The policy intent is clearly that contract prices expressed as GST inclusive should be able to be adjusted.

The uncertainty arises from the words in section 78(2) of the GST Act “or where the alteration in the law has been taken into account”. Accordingly, these words are being removed."

So it seems that my argument may have worked under the old law (which I suspected) but they changed the law when the increased GST.

I just find it interesting that everyone knew GST was going up, yet they did not advise new customers that their $40 a month plan fixed for 24 months would not actually ever be charged at $40 per month. Guess that's Vodafone for you. And to the "lovely customer services lady" I spoke with - an kindly spoken answer along the lines of the above extract from IRD would have easily answered my queries and put me at ease. No need to be a bitch. Again - what do I expect.

Appreciate the time you guys have taken to reply to my ranting! I am now (begrudgingly) satisfied that Vodafone is within their right to increase the price of my plan...

talisker

65 posts

Master Geek

#406632 19-Nov-2010 10:28

graemeh:
sxz: Contract law 101. Fair trading act and GST act.

Law 101, you can't have a contract that says anything different to the law unless the law says you can (i.e. that you can contract out of the law).

True, but the law doesn't say anything about what price you have to sell to customers at. Sure, Vodafone has to pay GST based on its sales, but there's nothing that says it has to pass all of this onto the customer. Many companies didn't increse their prices when GST went up.

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graemeh

2078 posts

Uber Geek

#406641 19-Nov-2010 10:49

talisker:
graemeh:
sxz: Contract law 101. Fair trading act and GST act.

Law 101, you can't have a contract that says anything different to the law unless the law says you can (i.e. that you can contract out of the law).

True, but the law doesn't say anything about what price you have to sell to customers at. Sure, Vodafone has to pay GST based on its sales, but there's nothing that says it has to pass all of this onto the customer. Many companies didn't increse their prices when GST went up.

Yes, that's right, Vodafone could have said in their contract that the $40 price continued after the GST increase but they didn't so they can put the price up to allow for the increase in GST as the law specifically allows that.