Government 'considered' VAT hike

Date: 26th November 2008

A leaked official document has suggested that the government was secretly considering a rise in VAT, according to reports.

Published on a government website, a Treasury note attached to an order in parliament stated that VAT would increase to 18.5 per cent by 2011.

At the pre-budget statement, chancellor Alistair Darling instead reduced VAT to 15 per cent and increased income taxation for the highest earners to 45 per cent.

Treasury minister Angela Eagle described the document's publication as "a pure administrative error".

She commented: "For anyone to think it is anything else is complete scaremongering and opportunism of the worst sort."

Ms Eagle could have been referring to Tory leader David Cameron, who reportedly stated that "there's a secret tax bombshell coming down the road at every family in the country."

The increase in income taxation is due to arrive in April 2011 - after the next general election.