Not VAT we really need

Surely I am not the only one to think that reducing VAT from 17.5 to 15 per cent to help us all out of the financial Armageddon is a bit of a half baked idea.

For a start it does not really help the low paid, pensioners, unemployed, hard pressed families and the like. For it to have much effect on your pocket you need to be spending enough for the reduction to make much difference which is just what the poor and pensioners are struggling to do in the first place.

Even if you do have enough spare cash to go on a splurge two-and-a-half pence, an old tanner, in the pound reduction will hardly have them queuing around the block - even on a £10,000 car it is only £250 - which brings me to the next point.

Do the Government honestly believe that our charitable and altruistic retailers and manufacturers will wipe two-and-a-half per cent off their prices overnight? Put your money on the flying pigs, it's safer. I suspect that the VAT returns will be the only figures falling by the full amont.

We will have a rush of price increases which, by a stroke of sheer bad luck, have been in the pipeline all along which will take up most or all of the VAT reduction where people can get away with it and even when the reduction in price is made there will be a rounding up of prices which, by a happy coincidence, will always be in favour of sellers so they should make a few bob out it - or maybe I am missing the point and that is really the idea after all.