Is VAT set for an increase?
28 August 2012
The UK Chancellor will be forced to raise taxes in the next budget, according to BDO Stoy Hayward, and a VAT increase looks the ‘politically safe option’.
BDO says that a 20 per cent VAT increase would raise a maximum of £9.5 billion a year. It believes that an overall rise in VAT is safer than tinkering with zero-rated items, which the Chancellor pledged in 1997 not to subject to either reduced rate or standard rate VAT during this Parliament.
Stephen Herring, tax partner at BDO Stoy Hayward, said: "VAT has...