ConDem VAT hike hits poor hardest

Chris Huhne

The rise in VAT introduced by the Conservative/Lib Dem coalition government has hit poorest families harder than wealthier ones the latest figures from the Office for National Statistics have suggested.

During the General Election last year, the Liberal Democrats had run a campaign warning voters that the Conservatives would deliver a VAT ‘bombshell’ which would see a 3% rise in the purchase tax costing families an extra £389 a year.

LibDem Tory VAT Bombshell

Lib Dem campaign poster 2010

At the time Lib Dem leader Nick Clegg assured voters that his party would not do the same:

“We will not have to raise VAT to deliver our promises…Let me repeat that: Our plans do not require a rise in VAT. Tory plans do”

However soon after the election the Lib Dems broke their promise and agreed with their new coalition partners to raise VAT by the predicted 3%.

Milliband Balls Burnham

Labour front bench campaiging in Eastleigh against Chris Huhne's VAT U turn

Eastleigh’s MP Chris Huhne even appeared in Parliament to deny that VAT was a ‘regressive tax’ –one which hits the poorest the hardest – and claimed a study from the Institute of Fiscal Studies showed that VAT was not regressive at all,

However earlier this week the ONS published their latest report on VAT which they say shows that the poorest fifth of UK households paid a higher proportion of their wages on VAT last year than they did in 1986 and that while 10% of their disposable income went on VAT while the figure for the richest fifth of households was just 5 %.

see also:

ONS Poorest households spending more

U Turn Huhne in VAT bombshell

Labour Leader hopefuls ConDem VAT rise

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  3 comments for “ConDem VAT hike hits poor hardest

  1. Elizabeth Holton
    November 3, 2011 at 9:22 am

    Well …. here we go again. Yet another U turn; yet more reneging. Obviously LD stands for Lying Deceivers.

  2. Peter Stewart
    November 3, 2011 at 7:23 pm

    Just remember where all that VAT is going…TO BAIL OUT THE EURO!

  3. November 3, 2011 at 7:39 pm

    Lets not forget that being a millionaire doesnt give you the common touch that is needed to understand the problems of everyday life or give you joined up thinking.

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