Labour accused of food VAT blunder

Harwich and Manningtree Standard: The Labour party campaign poster ahead of the European Elections, in London. The Labour party campaign poster ahead of the European Elections, in London.

Labour has been accused of blundering with a poster suggesting that the Coalition has put up VAT on food.

The campaign accuses David Cameron and Nick Clegg of adding £450 to shopping bills by increasing the levy.

The Tory and Liberal Democrat leaders are depicted as "peas in a pod", surrounded by images of everyday goods including fruit and vegetables, soft drinks, ketchup and biscuits.

But critics have been quick to point out that many of the items portrayed are in fact exempt from VAT - and so were not affected when the standard rate rose from 17.5% to 20% in 2011.

Most food and drink for human consumption is zero-rated, although the duty is charged on specific products such as alcohol, crisps and savoury snacks, and confectionery.

Tory MP Henry Smith said: "It's the same old economic incompetence from Labour. They have no long-term plan to fix the economy so instead Ed Miliband resorts to political gimmicks that don't even add up."

A Labour Party spokesman said: "David Cameron and Nick Clegg are desperately trying to deflect from the truth of their VAT bombshell.

"Their decision to increase VAT has added £450 to family bills over the year, on the Treasury's own figures.

"Families are paying more on their typical weekly shop as a result of the Tories and the Lib Dems and this poster rightly holds them to account.

"It is not an itemised list of everything they have increased VAT on - it is a representation of an average shopping basket."

Comments (4)

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11:56am Fri 9 May 14

Martin999 says...

Anyone thinking of voting Labour at the next election must have the memory of a goldfish.
Anyone thinking of voting Labour at the next election must have the memory of a goldfish. Martin999
  • Score: 7

11:10am Sat 10 May 14

H2o-hara says...

Everything is taxed anyway be it food or otherwise .
Everything is taxed anyway be it food or otherwise . H2o-hara
  • Score: 0

3:21pm Sat 10 May 14

varteg1 says...

So strange that when in France I look at prices and buy whatever, then when at the checkout I pay TVA (VAT) at around a similar level to our rate.

The strange thing is however that the overall prices I pay comes to approximately the same as I would pay here where there is no VAT applied.

But anyone discounting Labour's comments obviously thinks that the application of VAT down the line from producer to shelf is not reflected at the checkout.

Raise fuel tax (and Duty) for trucks inevitably raises the prices at the till.

The cumulative rise begins with the first 'sell' by the producer.

So, if an item of food costs £1 to produce, every time it changes hands through producer via wholesaler, transporter, distributor, warehouse, to shop, by the time you get your purse or wallet out, that initial £1 could finish up as £3 retail price.

So no, the VAT is not applied at the till, as it is in France, it is built in long before it gets to the checkout..

One thing is very noticeable, at least to me, now we are in the last leg of government by the coalition, prices seem to be coming down, with the perpetual rises we have been seeing for the last four years tending to come to a halt.

Even motive fuels prices seem to have suddenly stabilised.

Coincidence? I think not.


In fact on other blogs I forecast this would happen.
So strange that when in France I look at prices and buy whatever, then when at the checkout I pay TVA (VAT) at around a similar level to our rate. The strange thing is however that the overall prices I pay comes to approximately the same as I would pay here where there is no VAT applied. But anyone discounting Labour's comments obviously thinks that the application of VAT down the line from producer to shelf is not reflected at the checkout. Raise fuel tax (and Duty) for trucks inevitably raises the prices at the till. The cumulative rise begins with the first 'sell' by the producer. So, if an item of food costs £1 to produce, every time it changes hands through producer via wholesaler, transporter, distributor, warehouse, to shop, by the time you get your purse or wallet out, that initial £1 could finish up as £3 retail price. So no, the VAT is not applied at the till, as it is in France, it is built in long before it gets to the checkout.. One thing is very noticeable, at least to me, now we are in the last leg of government by the coalition, prices seem to be coming down, with the perpetual rises we have been seeing for the last four years tending to come to a halt. Even motive fuels prices seem to have suddenly stabilised. Coincidence? I think not. In fact on other blogs I forecast this would happen. varteg1
  • Score: 0

3:28pm Sat 10 May 14

varteg1 says...

Goldfish we may be, but we goldfish in our bowl were relatively well protected from the sharks who now habituate the waters we swim in.

I am no religious person far from it, but even the Pope today calls on governments to change policies so that the deprived get a fair shake.

But how can the sharks of Worstminster even hear his call for fairness, they're deaf to the cries of the poorest.
Goldfish we may be, but we goldfish in our bowl were relatively well protected from the sharks who now habituate the waters we swim in. I am no religious person far from it, but even the Pope today calls on governments to change policies so that the deprived get a fair shake. But how can the sharks of Worstminster even hear his call for fairness, they're deaf to the cries of the poorest. varteg1
  • Score: 0
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