Edinburgh families could get £120 million boost under temporary VAT cut, claim Lib Dems

A temporary cut in VAT advocated by the Lib Dems to protect people from the cost of living crisis would put almost £120 million back in the pockets of Edinburgh families, the party has claimed.

By Ian Swanson
Wednesday, 16th March 2022, 4:55 am

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UK party leader Sir Ed Davey proposed at the Lib Dem spring conference last weekend that the standard rate of VAT should be reduced from 20 per cent to 17.5 per cent for one year to ease the pressures on people at a time when bills were soaring.

He said the move would mean households each getting back around £600.

And the party said the plan would support the economy by boosting spending in local high streets, while keeping inflation down by making the prices of everyday items lower than they would have been.

Lib Dems argue the emergency change to VAT could be introduced quickly and easily by the Chancellor for one year.

And they want Rishi Sunak to use his spring statement on March 23 to bring forward the cut as well as scrapping the Conservative’s National Insurance tax hike, to bring much-needed respite to local families.

The party has calculated the proposed VAT cut would mean putting around £119,640,000 back in the pockets of 199,400 families in Edinburgh.

Christine Jardine is Lib Dem MP for Edinburgh West

The party’s Treasury spokeswoman and Edinburgh West Lib Dem MP Christine Jardine said: “The Conservative cost of living crisis is hitting families hard and it is about to get worse. People across our community are worried about how to make ends meet as bills go through the roof.“An emergency cut to VAT would offer a massive boost to people in Edinburgh feeling the pinch by putting £199,400 back into their pockets. It would also support our treasured shops, cafes and restaurants by boosting spending on the high street.“This is crunch time for the Chancellor and the Conservatives. Will they act or just inflict more financial pain on families by clobbering them with another unfair tax hike?”Experts have warned that the war in Ukraine will worsen the cost of living pressures facing households, with energy, food and fuel bills all expected to rise. Inflation is also forecast to reach eight per cent or more in April, its highest level in decades.

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