VAT To Be Cut?

The Government is to announce its pre-Budget report on Monday, and there are some suggestions that VAT (Value Added Tax) may be cut by the Chancellor, in a bid to get people spending again.

The rumour is that VAT could be cut from 17.5% to 15% for a year. There could also be other tax cuts announced, along with help for those facing repossession and small businesses.

However, any tax cuts are likely to be short-term, and inevitably will be followed by tax rises, once the economy starts to settle down.

We’ll have more coverage of this “exciting” pre-Budget report on Monday.

On a related note, the Times recently had a poll asking what taxes people would like to see reduced. VAT was the most popular (21%), followed by tax relief on all savings (19%) and 1p off the basic rate of income tax (16%). Full poll results.

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