Nobody likes a tax increase and nobody likes a 20% tax on anything. But a perceptive shopper interviewed by SKY on the day of the VAT increase did not quite give the answer that the reporter was fishing for. ‘If they did not put it on VAT they would have to make cuts elsewhere’, she said.
It seems to me this lady would make a better shadow chancellor than Alan Johnson. He favours a direct tax on jobs (NICs) rather than an indirect tax on goods (most of which are imported anyway), but he still claims VAT will cause job losses but NICs will not.
When it come to economics Johnson does not know which day of the week it is – he even does not know what Labour Policy of the week it is. But in doing this he is simply playing to the wishful thinking of his party supporters, ‘deficit what deficit?’ they cry. No need for cuts, well not serious ones. A bit of a growth pill will cure us – dissolved in a beaker of inflation.
The reality is that even with the cuts our debt will be costing us £60 billion a year in interest payments alone by 2015. £60 billion we cannot spend one way or another on ourselves – but must give away to foreigners. All simply because Gordon Brown could not live within our means.
And given half a chance Labour would do it all over again. Spending is a disease, and with them it is incurable.