They still have to be competitive in the marketplace - otherwise whats stopping corporations from blindly gougi…..I don't necessarily disagree with your overall point, but this may not be the best example. One can easily walk across the border and buy the iPhone in the country with lower VAT. For that reason, retailers in the higher VAT country have every incentive to cut into their profit margins to equalise the price between the countries.
……Err looks at price of lamb at farm gate… looks at price of lamb in colesworths…
Errr Nevermind.