Some reasons why we in the UK pay more for certain goods than other countries(Image: AP Photo - Lee Jin man)

Fancy an Apple iPhone4? If you like the look of this smartphone and live in Newark, New Jersey, you can get it for $199 (£123). But if you live in Newark, Nottinghamshire - or anywhere else in the UK for that matter - the cheapest you can get it is £439.

If you live in Birmingham, you can get a Dell Inspiron 15 laptop with 320GB of memory for £349. But if you live in Birmingham, Alabama, you can get it for two thirds that price, $399, which is £247.

The long-awaited new Nintendo 3DS games console is more expensive here too: £229.99 compared with $249.99 (£154.80) charged in the US.

How fast is your cost of living rising?

Are we being ripped off?
Right across the electronics market prices are higher here. So why exactly is it that we end up paying over the odds for so much? Are there good reasons for it or are we being ripped off?

"The assumption people make is that price is based on the cost of manufacture," Cliff Burgin, principal of pricing consultancy Burgin Associates, told MSN Money. "In fact it is based on what the market will bear."

He said that suppliers will look closely at each market, what competing products are available and their pricing before deciding how to price a new product. For smaller markets - particularly those where translation of instructions, different voltages or other technical issues exist - there might be genuine additional costs.

I checked Apple and Dell prices across numerous markets but it didn't perfectly follow this model. You can get an iPad for £439 here, whereas it costs $499 (£309) in the US, which is as expected. But in the Netherlands, a smaller market than the UK, it costs €499, which at £426 is less than we pay.

"For the pricing of the iPad, Apple would have looked at the position it occupies for its broad utility [the services and apps it has] against other products, even though Apple's combination might be unique," Burgin said.

Tax is only a small part of the answer
Tax differences have historically accounted for some big price differences in some goods. Tobacco, for example, is a fraction of the price in some European countries compared to what it is here. The same used to be true for fuel but this is much less marked now across Europe.

Taxes and duties certainly account for the huge gap in the cost of fuel across the Atlantic. While we pay £1.30 a litre for unleaded petrol, American consumers - who pay only light taxes on gasoline - are now complaining about prices creeping up to $3.11 per gallon, which equates to just 43p a litre. However, with 67% of the UK pump price being made up of duty and tax, the underlying cost of fuel in the UK and US actually appears to be remarkably similar.

So what about those electronic goods? Phones and computers and similar products sold in the UK attract VAT, now at 20%. Those equivalent goods sold in the US also attract a state sales tax. That's true for internet sales too, so long as the retailer has a physical presence in the state where the customer lives. But most US state sales taxes are 6-7% with only a handful over 8%. None are as high as 20% and several have no sales tax at all.

So the biggest difference that could be accounted for by tax differences alone is 10%. Yet, in almost all cases, the discrepancy between British and American prices is way bigger.

Bearing a higher cost
So if Burgin is right, how come the UK market can bear a higher price for so many items than the US? Perhaps Britain is just a fairly wealthy economy.

However, that doesn't appear to be the case either. British per capita national income in 2009 was $35,590 (£22,041 at today's exchange rate), according to Oxford Economics. That is 10% lower than France and Germany and a full 23% lower than the US.

Now, this is a slightly complex field, because the figures are translated at prevailing exchange rates. The slightly more accurate purchasing power parity calculations, which take account of the cost of living in local terms in each country have Britain ahead of Germany, France and even Japan, according to Oxford Economics -- but they still trail the US by 25%.

"The fall in UK GDP per capita in 2009 combined with the decline in sterling means that the UK has seen an even sharper decline in its relative living standards compared with other major economies," said Andrew Goodwin of Oxford Economics.

In other words, boiling down both income and prices after the global financial crisis means that we in Britain can still on average consume more than most European countries, but less than the US. So in purely financial terms the UK market can't bear more but prices are still higher.

Shopping across the Atlantic
There are certainly some strong historic trends at play. For years British tourists have taken advantage, particularly when the dollar has been weak, of visiting the US to load up on cheap CDs, clothes and various other consumer goods that the US offers for less.

American Jenny Evans and her British husband Ian have been regular transatlantic shoppers for years, waiting for the right moment in the exchange rate.

"I look for savings on brand clothing like Tommy Hilfiger and Ralph Lauren," said Ian, noting that in a sale he can get them at a quarter of the price they might be in the UK. They also load up on the very biggest containers of branded shampoos and other toiletries, which are not available in such large sizes in the UK.

Is the US recovering faster than the UK?

Where Brits pay less
However, not everything runs in the same direction. Jenny and Ian Evans notice that many foodstuffs are expensive in the US compared to here. "Bread, chicken and some other foodstuffs are quite pricey. But if you eat out, then it works out about the same," Jenny said.

Many household products and toiletries in the US are way more expensive than here. Take toothpaste. You can buy Crest Total in the UK at many supermarkets for just over £1. The equivalent in the US costs around $5.45 (£3.40). That differential held good for more than 15 brands I checked on the website of giant US drugstore chain Rite Aid.

In fact, whether it is toothpaste, soaps, basic cosmetics, painkillers or feminine hygiene products you can expect to pay at least twice in the US what you pay here, and usually three times as much. And that's even before you look at the ultra-cheap own brands that we have in abundance.

"We have an intensely competitive grocery market in the UK," said Cliff Burgin. "If supermarkets get their teeth into a product category, they force prices down."

It would be nice to distil a clean, neat answer to the conundrum of differing prices between countries. But in the days of the global shopping trip, perhaps we don't need to.

With Brits travelling to Hungary and Cyprus for dentistry, Hong Kong for bargain spectacles, Singapore for the cheapest electronics and the US for a whole array of cheap designer goods, the travelling consumer might still be able to end up a winner.

Laugh your way through austerity with a signed copy of Nick Louth's 'Funny Money'

Related links
The latest discount codes and vouchers
Sneaky retail tricks that get you spending
Get free investing guides delivered to your door
Trade over 11,500 stocks on 23 major exchanges on MSN Trader