Right, I want to put this to bed eventually.  Apart from VAT, what other taxes are involved in the importing of consoles to the UK before they reach the store and then the comsumers' hands?

US costs:

Wii - $249
DS - $129
360 Core - $299
360 Premium - $399
360 Elite - $479
PS3 - $499
PSP - $169

UK costs:

Wii - £179 (£152 Ex VAT, $296)
DS - £95 (£80 Ex VAT, $156)
360 Core - £189 (£160 Ex VAT, $312)
360 Premium - £279 (£237 Ex VAT, $462)
360 Elite - £329 (£280 Ex VAT, $546)
PS3 - £425 (£360 Ex VAT, $702)
PSP - £129 (£109 Ex VAT, $212)

As you can see, I've taken off the 17.5% VAT off the UK price and converted it into dollars ($1.95 = £1).  If the UK console prices only have to incur a VAT charge, then you can see how much of a ridiculous gap there is in the general price comparisons.

I hope I can clear this up as there is a very large possibility that there are extra taxes that need to occur before a console can appear on the shelves in the UK.

If there isn't, then we are paying the following difference.

Wii - 19% more
DS - 21% more
360 Core - 5% more
360 Premium - 16% more
360 Elite - 14% more
PS3 - 41% more
PSP - 25% more

There is a huge difference with the cost of the PS3!!  A 41% increase on the cost of the US model. 

That's why I will never get a PS3. Imagine here in Greece it costs 659E!!! Steal...

Yeah, there is a lot of false information spreading about this matter, such as the "taxes explain everything" myth. And Sony's David Reeves also contributed by saying the following:

GS UK: But Europe is paying a higher price than the US already, before the price cut, if you convert it to dollars.

DR: It is. But so is a McDonald's hamburger. You can buy a hamburger here for $4.99, or for £4.99 in the UK. That's just how it is.

(which btw would imply the PS3 is cheaper in UK lol)

I've heard this 4.99 crap is not true, maybe someone in UK can confirm?

Some of the added cost is due to the increase in the cost of doing business in many countries; things like minimum wage, standard benefits, and business taxes are quite a bit different in many European countries as compared to North America and Japan.

Beyond that, companies like selling products for nice 'round' prices so when the expense of delivering the product passes a 'price point' they just increase the price to another good 'price point.'

If the higher cost is because there are other taxes, how come the 360 core is only 5% more?
Surely there is no PS3-specific tax that forces them to charge 41% more in the UK?
15-20% extra sucks, but 41%, that's just highway robbery.

I'm sure HappySquirrel is right and it's all about nice round prices and good price points, but then why couldn't they make the PS3 around £379/89/99 instead of £425?

£425, that's $829!

"That's why I will never get a PS3. Imagine here in Greece it costs 659E!"

E659 * 1.378 = $908!

Do we have the convertion ratio when each of these consoles was launched?  It may not have as much to do with the current ratios as is does with what the ratios were at launch.  I am assumming the prices were set at that point and the manufactures don't want to fluctuate the price weekly just to keep up with the yen to £ or the zen to $ ratios.

The PS3 is especially ridiculous I have to say.

I suppose the land here in the UK is way more expensive so the rent or purchase of the property by the retailer will be significantly higher. The distribution costs will be a bit higher due to smaller shipments going to a more specific location. The minimum wage is higher here so again like with the land issue the retailers will have to charge more to cover extra outgoings.

That's about all I can think of and I'm sure it still doesn't cover the crazy mark-ups.

I suppose one way you can look at it is this. If the MS isn't making any less profit on th Core 360 in the US than the UK then all of the above costs come to around 5% per console, the figure in the OP. If we apply this to all consoles then we get:

Wii - 19% more becomes 14%
DS - 21% more becomes 16%
360 Core - 5% more becomes treating UK dwellers the same as US!
360 Premium - 16% more becomes 11%
360 Elite - 14% more becomes 10%
PS3 - 41% more becomes 36%
PSP - 25% more becomes 20%

In summary Sony is completely taking the piss out of it's UK customers, N are better but still making a tidy profit from it's mark-ups and MS is surprisingly reasonable with an average of about a 7% mark-up on it's 3 SKUs.

Good thread by the way.

Hello, Newbie, but i have some input for you on this pretty complicated matter....

Firstly, i'm from the UK so i know how great it is going abroad having a strong £ - it makes european shopping trips awesome because i can buy so many Euros for my good old Pound Stirling.

Problem though, is people coming across to the UK find that there Euro or $ is worth diddly squat here. thats part of the problem, as i'm sure you are aware. when they bring consoles into Europe, they've got to pay for the transport which gets increasingly higher the closer you get to the UK.

First, they've got to bring all them consoles into Europe, that means $ buying Euros - thats not a good exchange rate and partly explains why consoles are more expensive than in Europe than Japan and NA. I know that sounds a little backwards, but Europe isn't buying consoles at this point, the manufacturers are bringing their services into the country, and that hits hard.

On top of that, European wages are also higher - so something else to pay for - everyone wants that little bit more money. then transport costs are higher (petrol in europe is almost £1 per litre... check that out in the US!). Taxes are also higher in Europe (due to greater public service provision - we like our 'free' stuff here, while in the rest of the world they pay for it when they need it at a higher cost).

Now here's the fun bit - the consoles at this point are in Europe - they haven't even reached the UK yet. all them problems about bringings the consoles into europe... well, now we've got to bring them from Europe into the UK (i'm talking economically - they don't actually go through Europe, they come straight to the UK by boat most of the time - but the money goes that way). UK has higher taxes still, the Euro is rubbish against the £, wage bills are even higher, transport costs are even higher, and land price (store rent) is also higher.

Then of course, there is the age old exploitation on top. maybe not as big as somepeople say, but its definitely there.

all these add up little by little until you get something resembling extortionate... painful huh? hits you right in the wallet. all them little taxes, all them wage hikes, those few more miles, that hard exchange rate... thats why we gt hit oh so hard on most things. having such a strong economy for such a small country hurts us sometimes.

The killer price is the PS3 IMHO. Yes, you can pick it up for £399 instead of the MRRP of £425 and shortly you will get an extra sixaxis, Motorstorm and Resistance all bundled for the MRRP of £425 which IMHO will probably stay at £399 at most places. Seeing as the basic unit is more than $200 more expensive (once deducting VAT from the UK price) than the US price, I can see no reason why at some stage this year, SCEE can't reduce the price to make it closer to £299 without the bundle.

SCEE have stated that there will be other deals coming up after the Starter Pack in preparation for the "holiday season". And I sincerely hope that they do bring the price of the basic PS3 unit down to £350, but IMHO it would be better for Sony all round in the UK if they made the PS3 £299 and the Starter Pack £349 in time for Xmas.

You can get slightly cheaper deals if you look around but the same can be said about any country(wasn't the US Amazon offering something like 5 free BR movies or something?) so I don't think it detracts from the origional figures.