Understanding UK Pricing And Currency

It is well known that the UK uses pounds rather than the Euro or the dollar, and changing money upon entry into the country is now a well-established travel norm. But the economic differences between London and other countries don't end with currency.

Sales Tax is Included

In America and some continental European countries, the price you see on the shelf does not reflect the actual sale price. Sales tax is calculated after you have brought the item to the register, and with complex equations governing just how much tax is charged. Because of this, it is usually quite difficult to know the final cost of an item.

London has a very different system. In the UK, tax is included in every listed price. There is no ambiguity; quite simply, what you see is what you pay. This system is ultimately more convenient for travelers, although for those coming from countries like the US it can be a bit of a shock at first.

Tax is added to everything, from food in grocery stores and restaurants, to clothing on the High Street, to souvenirs purchased for loved ones back home.

The Currency Difference

Beyond the inclusion of sales tax, the UK also uses the Pound Sterling, informally known as the quid. Even though the majority of Europe decided to switch over to the Euro, the UK still maintains itself with its traditional currency system. The exact exchange rate varies between countries and over time, but it is never difficult for travelers to find a currency change in the airport and throughout the city.

However, many who travel into London find they can receive a better exchange rate by taking out pounds directly from ATMs conveniently located throughout the city.

Paper money, called notes, is available starting at five pounds. Notes are different colors and sizes, depending on the value. Coins, called pence, or p, are available as 1 penny, 2 pence, 5 pence, 10 pence, 20 pence, 50 pence, 1 pound and 2 pounds.