Ahead of the proposed reimplementation of the 17.5 per cent VAT rate on December 31st, The British Retail Consortium has urged Government to postpone the change,
VAT was dropped from 17.5 per cent to 15 per cent last year as part of the Government's plan to avoid wide scale slumps in the economy. It said at the time that the old rate of 17.5 per cent would be bought back at the end of 2009.
However, the BRC is now saying that introducing the rise during what is retail's busiest time of year could be damaging for the sector. It adds that it cost retail 90m to implement the first VAT drop, and that it will cost approximately the same when VAT goes back up.
The body is asking Government to postpone the rise for a month.