Before the General Election I did not see myself ending up voting for a rise in VAT. None of the 3 main parties said that they would increase VAT, but we find ourselves with an increase to 20% from January.
Personally I would have preferred an increase in Income Tax (alongside a bigger increase in the personal allowance to help the lowest paid taxpayers), but I suspect that an Income Tax rise would have been just as unpopular. No one wants to see tax rises and no one wants to see budget cuts but both are necessary.
I didn’t vote against the VAT rise because there isn’t a credible alternative on offer. The Nationalists put down an amendment to stop the increase, but they haven’t offered an alternative.
Labour have been very hypocritical – they claim to oppose the VAT rise (but abstained on some votes), but documents in the Treasury clearly show that they had every intention of increasing VAT!
I don’t want VAT to stay at 20%. I had a question at Treasury questions yesterday and I argued that once the deficit has been dealt with and we have got the economy back on its feet we should be looking at bringing VAT back down to 17.5%. Tough times call for tough action, but once the emergency is over we should reduce VAT again.

3 responses to “VAT

  1. I too do not like the idea of paying more VAT. It is also a regressive tax, hitting the poor harderst Unfortunately, I do not think it will come down again once the deficit has been eliminated. This is both because of not wanting to squeeze expenditure further than necessary and the aim of raising the personal allowance for income tax to 10k.

  2. Agreed with all of this. But I just came here to say that today, by opposing the extension of 28-day detention, you have made me proud to have campaigned for you as much as I did. It’s very good to see a Lib Dem MP taking the right approach – working to make the coalition government work and taking a positive attitude to it, while at the same time not allowing that to overrule your principles. So thank you.

  3. It’s interesting to hear your conflicts about it, John. I am one of the many who were Lib Dem supporters (and members) before the election, but who were left feeling angry and betrayed after the election. Your sensible approach and strive for principle amid a difficult coalition deal gives me hope that I may be able to support the Lib Dems again in the future. More power to you.

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