“Vat’s the way to do it..”

I have become very angry over the last 24 hours listening to the absolute bollocks that has been peddled by TV news (ITV and BBC for a change) about yesterday’s increase in VAT.

Let’s look at some of the quotes that have been shown in interviews with politicians and on the street vox pops :

“My business will suffer because the increase in VAT will leave people with less disposable income” – absolute bollocks. It will have no effect whatsoever on disposable income as it is a tax on spending not income. Nice scaremongering though.

“I’m worried about the increase in food prices.” This from a student. As there is no VAT on food, the only reason I can think of for believing this – apart from the fact that he may possibly be a brian washed leftie that believes Milipede propaganda – is that a student’s version of food comes across the bar or in takeaway wrappers. That’s not real food, mate, so it doesn’t count. Learn to cook!

“We’re no going to be able to go out down the pub with our mates or eat out when we want. It’s not fair!” I think that just about sums up the out of touch with reality element in this country.

“A family on £25,000 a year is going to be £396 a year worse off.” Now what the fuck do you base that on? Needless to say the calculation is not explained. As VAT is on spending not income, exactly how are we able to make this comparison? Lies, damn lies and statistics…

“It hits the poorest families more than the rich.” More bollocks. It’s nonsensical to look at the effect on earnings as it is a tax on spending. If I earn a million quid a year and spend sod all, then there is no VAT. Ditto if I earn fifteen grand. More accurately, you should look at the effect on spending power and not income. When you do this, it actually hits the richest worst.

“Comsumer groups warn that businesses will put up prices by between 5 and 8 per cent not just the 2.5% VAT element.” Well for a start the actual increase is less than 2.5% because it’s on the NET figure not the figure that already includes tax. Furthermore, if this is the case, it is called PROFITEERING and that is fuck all to do with the VAT increase – it’s just opportunistic greed!

Miliband says it is the wrong tax at the wrong time. He refuses at all junctures to answer the question “What would you do instead?” This is because the only viable alternative is National Insurance – and that really does hit the poorest worst because it hits their wage packets and employers’ wages bills.

He also conveniently forgets that the last Labour government tried to raise VAT twice but the move was blocked by Gordon Brown. And the perpetrator of the idea was – er – Ed Miliband.

One word of common sense came from a pensioner : “We’ve all got to pull our horns in ‘cos we’ve got no money. Labour spent it all. Anyway, we’ve managed before and we’ll do it again”

That last one was on the local news. I’ll bet it doesn’t make the nationals…

Advertisements

6 responses to ““Vat’s the way to do it..”

  1. We've got no money right enough Dioclese. The City of London has the lot.

  2. A student diet tends to revolve around different flavours of Pot Noodle, which are VATable.I like the way they always bleat on about stuff hitting the poorest first. Yes, their plasma tellys will be more expensive but they generally use our cash for those anyway.Good post.

  3. OK. 2.5% = 396 quidtherefore total vat-able spend is 100% (ex vat) is 396/2.5 * 100 = £15840.(Blimey! that's ALOT of Cider) Now add the Vat @20% = £19008.at 17.5% it would have been £18612 Now add non vat-able.. food for say family of 4… £100.00 week (yes I'm tight aren't I?)say £5000/yr.Total now £24008.What about utility bills? (I don't think the vat increased on these from 8%?) say £1500/yrTotal now £25500Income tax & NI on wages of £25000 say about £6000. So disposable income is about £19000. Bung in family allowance on 2 kids ~£30/wk = £1500/yrDisposal = £20500Outgoings = £25500 (excl rent/mortgage) Methinks our friends at the BBC have over-egged the cake a tad. By the way our (dis)honest compatiots in the Labour Party (Alistair Darling) had openly stated that they were going to put Vat up to 19% if they had got back in

  4. Knew I could rely on you, Billo! Actually the figure came from the Milipedes. Probably explains how we got in the shit in the first place if this is an example of how they do their sums!

  5. I did a quick calculation too. If 2 1/2% is going to raise 13 billion, then the total added value of the UK economy is 13 / 2.5 x 100 = 520 billion. The Government proposes to spend about 680 billion this year. So they will spend more than everyone actually makes put together – and more.What future?

  6. Two examples of affected "poor"1. "My kids will lose out on their crisps, cola, Friday night Domminos pizza and Saturday Chinese"2. "We've all got to pull our horns in"My concern is that the people in group 2, who probably do live a generally VAT free frugal life (except for utilities), will be affected by the increased transport costs of their VAT free foods and be worse off.Group 1 poor?