fbpx

News & Blog

Read the latest business news, blogs and thought leadership articles from our members, as well as updates on the Edinburgh Chamber of Commerce's work in the city.

News & Blog

It’s Time to Cut VAT to Bolster Demand

Posted: 13th June 2017

The news that inflation has risen to 2.9% has reinforced the case for a temporary reduction in VAT, according to the Scottish Chambers of Commerce.

Liz Cameron, Chief Executive of Scottish Chambers of Commerce, said:

“This week we have learned that household spending has fallen for the first time in four years, which comes as no surprise given continued high inflation, which has been outpacing increases in earnings. This is an early warning sign that there is a real threat to our economy from a decline in consumer spending power.

“Although the political situation at Westminster has not yet fully settled down following last week’s General Election, the continued elevated rate of inflation above the Government target of 2% calls for urgent action to address the impact this is having on businesses and consumers.

“At the time of the financial crisis and recession in 2008-09, the UK Government reduced VAT on a temporary basis in order to bolster consumer demand and it is time that such a move was considered again to give people the confidence to spend and to reduce the pressures on business margins. Everything possible must be done to maintain consumer confidence in these uncertain times to provide a route to business growth and economic prosperity.”

Business Comment

Business Comment is the Edinburgh Chamber of Commerce’s bi-monthly magazine. It provides insight on Edinburgh’s vibrant business community, with features on the city’s key sectors, interviews with leading figures and news on new business developments in the capital.
Read more here