Yay, VAT went up today. Whilst the news agencies have made a little bit too much of a fuss about an increase which most people will barely notice it’s important to remember just how regressive VAT is.
Afterall “If you look at the effect of sales tax, it’s very regressive, it hits the poorest the hardest. It does. I absolutely promise you..it goes very very widely. VAT is a more regressive tax than income tax or council tax.”
As Guido points out this is none other than David Cameron. As your bi-weekly reminder that you really can’t trust anything politicians say Guido also notes that 2 weeks before the election David told us that:
“We have absolutely no plans to raise VAT. Our first budget is all about recognising we need to get spending under control rather than putting up tax.”