Do you think the next government will raise VAT?

Hedgehog99

Recently, I've seen MPs from the "traditional three main parties" dodge the VAT question.

Are they all just keeping their cards close to their chest before they reveal their manifestos? :cool:

Surely if any party had already decided it wouldn't, they'd be only too pleased to shout it from the rooftops?

Maybe April will be the month to stock up on essentials that attract VAT?

CLAPTON

Hedgehog99 wrote: »

Recently, I've seen MPs from the "traditional three main parties" dodge the VAT question.

Are they all just keeping their cards close to their chest before they reveal their manifestos? :cool:

Surely if any party had already decided it wouldn't, they'd be only too pleased to shout it from the rooftops?

Maybe April will be the month to stock up on essentials that attract VAT?

obviously not,


as in 2010, all three said, they had no plans to raise VAT

kidmugsy

Ask that nice Mr Balls. I dare say he'll be the next Chancellor.

Judging by whom Santander have just appointed as their new Chairman, they assume that the next government will be Labour.

Pennywise

There is always pressure from the EU to harmonise VAT, and most other countries have a higher VAT rate than the UK. If we stay in the EU, it's inevitable that VAT will rise sooner or later. One thing for certain is that it will never fall! Nothing to do with UK politics, it's all in the hands of the EU. We can try to delay it, but the increase in inevitable if we stay in the EU.

le_loup

Really?
List the UK governments that have raised VAT and then list the ones that have lowered VAT. I think it will be a revelation - unless, of course, you are too biased to accept the conclusion!




... or too young to remember.

Pennywise

Labour lowered it only temporarily due to the recession but needed permission from the EU to do it, and that permission was granted on the condition it was temporary.

sheramber

The EU sets the broad VAT rules through European VAT Directives,and has set the minimum standard VAT rate at 15%. The 28 member states are otherwise free to set their standard VAT rates. The EU also permits a maximum of two reduced rates, the lowest of which must be 5% or above. Read our briefings on EU VAT Registration and EU VAT Returns.


http://www.vatlive.com/vat-rates/european-vat-rates/eu-vat-rates/

Scarpacci

Yes, I would expect so under either party. Even with the cuts promised by all parties, more will need to be done to reduce the deficit. The tax take has been weak (not unconnected to the cuts in income tax & corporation tax), which is part of the reason the deficit is larger than anybody would have liked, and VAT is a fairly broad-based tax on the economy.

Look at the direction of others taxes under this government and the previous Labour government. Corporation tax is only going one way and that's down. Income tax rates have largely stayed the same (except for the hoopla over the 45/50% rate), with the personal allowances going up - especially so under this government. I would think a VAT raise is more likely than a change of course on those taxes. A period of low inflation or even deflation would seem like good cover to raise VAT, from a political standpoint.

CKhalvashi

I can see VAT going up, probably to 21 or 23%, but that's just my opinion.

Income tax is down, and tax-free allowances (ISA, income tax threshold etc) are up, so it would be the main thing to increase the revenue to the treasury.

Hedgehog99

Governments like it because it's hard to avoid, but, on the general things we all inevitably need, it takes no account of the ability to pay.

It's galling when people more able to afford it than I am decide they'll avoid it by buying something for work that is then available for personal use (e.g. laptop).

So, after the election next year:

Cooking from scratch (almost always do now anyway)

Restricting other VAT-susceptible food

Not buying any clothes

...and before the election:

Stock up on shampoo / laundry detergent etc. that'll keep for a while.

prowla

Pennywise wrote: »

Labour lowered it only temporarily due to the recession but needed permission from the EU to do it, and that permission was granted on the condition it was temporary.

Labour lowered it, with the intention of it going up to 20% after the election anyway.

If they do put it up more, it'll just hit the economy more, so the government will get a bigger percentage of a smaller pot.