While indirect taxes such as VAT are...
bad news for the poor and in theory a cut in VAT should help those on the lowest incomes the most, in reality I fear that price cuts are unlikely to be passed on to consumers.
Even if they were passed on, I doubt a 2.5% cut will have much impact on demand and politically, voters are unlikely to credit the government for falling prices anyway.
Also crucially, with deflation now seen as the biggest threat - a cut in VAT might risk deflation even more.
What Gordon Brown should have done is cut council tax bills or given a one off payment to those earning less than £15k.
Once again Brown has missed a massive opportunity to set the agenda - the current economic crisis has handed left-wingers a fantastic opportunity to redistribute. ALL voters would support help for the poorest. Instead, we are reminded what a bungling idiot Brown is and how he managed to blow an election winning lead last year in the space of a few months. Brown is a liability and once again - Labour have got to get rid of him if they seriously want a fourth term.
Expect his leadership to be questioned soon as the piss poor Tories undeservedly extend their lead despite little enthusiasm for them from the public.
Even if they were passed on, I doubt a 2.5% cut will have much impact on demand and politically, voters are unlikely to credit the government for falling prices anyway.
Also crucially, with deflation now seen as the biggest threat - a cut in VAT might risk deflation even more.
What Gordon Brown should have done is cut council tax bills or given a one off payment to those earning less than £15k.
Once again Brown has missed a massive opportunity to set the agenda - the current economic crisis has handed left-wingers a fantastic opportunity to redistribute. ALL voters would support help for the poorest. Instead, we are reminded what a bungling idiot Brown is and how he managed to blow an election winning lead last year in the space of a few months. Brown is a liability and once again - Labour have got to get rid of him if they seriously want a fourth term.
Expect his leadership to be questioned soon as the piss poor Tories undeservedly extend their lead despite little enthusiasm for them from the public.
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