LONDON: The British Retail Consortium warned the government that any VAT increase "would have negative impacts on retailing and the wider economy", and VAT should not be extended to exempted items such as food, books, children's clothing as this "would hit the most vulnerable members of society the hardest".
Buy many senior managers privately concede the rise in VAT in inevitable and are merely seeking to delay its introduction, reports the Financial Times today.
Senior managers from some of Britain's biggest chains told the Financial Times that they were resigned to an increase and were lobbying instead to postpone the rise until early next year. "It is more a case of arguing how it goes up and when it goes up," said one retailer.
Staging the VAT rise to give business time to prepare for the change is more important according to senior Conservative party sources quoted by the newspaper. "VAT could be raised in January 2011, with a further rise coming in January 2012 – this would show retailers that the measure was not just about the short-term."
