Store owners struggled to make the necessary changeover as VAT rose from 15% to 17.5% on January 1, with many opting to take advantage of the two-week period of grace before changing shelf labels.

Trade bodies had asked that the government delay the VAT increase so that it would not clash with staff holidays, but their request was rejected.

Sylvia Winter who runs Creaton Village Stores in Northampton had to scan every item and change the rate manually.

"It's been a complete nightmare for us. We've had to work evenings to change more than 1,000 products," she said.

"We did consider letting our stock levels run down so there would be less to scan, but then we still have to ensure customers can find what they want."

Derek Gillpin, who runs Arlecdon Post Office and Convenience Store in Frizington, Cumbria, is taking advantage of the extra two weeks grace for changing labels and waiting for his next delivery of stock before going through the process. "Once that comes in we'll be able to change the labels quicker while re-stocking," he said.

The Association of Convenience Stores dismissed the grace period as a "hollow gesture", which would cause confusion for customers as they would see one price on the shelf and another at the checkout.

Derek added that the difference in price has been negligible for most products. "It's a lot of hassle for such a non-event," he said, "Customers only really noticed on cigarettes."

Another issue affecting retailers is pricemarked packs. Sylvia said that her business would have to absorb the rise where these were still on shelves.

Association of Convenience Stores public affairs director Shane Brennan said: "Retailers coped with the VAT changeover largely very well. The reality of many government-imposed burdens is that retailers find a way to make it work, but this in no way justifies the stress that was heaped on retailers in this most difficult of trading periods."

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