Major abandons his VAT promise
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.JOHN MAJOR prepared the ground yesterday for a possible extension of value-added tax to newspapers, fares, food or children's clothing, something he had previously said was unnecessary. Both the Prime Minister and Kenneth Clarke, the Chancellor, refused to repeat earlier promises to retain zero-rating.
Labour claimed the Tories had dropped 'another tax bombshell'. Gordon Brown, the shadow Chancellor, promised that a future Labour government would not extend the tax to those items, but shrank from promising any cut in the rate of VAT on domestic fuel.
Questioned on yesterday's BBC Election Call phone-in, the Prime Minister said: 'I can't rule things in and I can't rule things out. That is not a suggestion that it is going to happen. No Chancellor will indicate in advance what is likely to be in his Budget. . . . We have no plans to do so . . . those are matters that Chancellors have to look at in the future.'
Mr Major said during the 1992 general election campaign: 'I've made the pledge in the past. We have no plans and no need to extend the scope of VAT.'
Mr Brown said: 'Having made absolute, unconditional and personal promises at elections, both Mr Major and Mr Clarke are now attempting to change ground.'
Harriet Harman, shadow Chief Secretary to the Treasury, said extending VAT was the Tories' 'hidden agenda'.
Labour yesterday reiterated its constant theme that VAT is an unfair tax that hits the poorest because it takes no account of income. Mr Brown's refusal to make any commitment to cutting the rate on fuel constrasts with an indication from the late John Smith in a 10 March interview with Grampian television that a future Labour administration would try to reduce it.
While a binding undertaking given by Norman Lamont, when he was Chancellor, bars the restoration of zero-rating once abandoned, European Union rules allow for cuts down to 5 per cent. Such a reduction from the 17.5 per cent due to apply from next April would cut revenue by more than pounds 1.5bn a year, potentially increasing pressure for spending cuts or higher direct taxes.
Mr Brown stonewalled reporters' questions at a London news conference, saying: 'Other policy decisions will await our election manifesto.'
Howard warning, page 6
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments