We reduced the standard rate of Value Added Tax to 15 per cent. from 1 December 2008 to 31 December 2009 as part of a wider fiscal stimulus putting £12.5 billion back into the economy. It would be premature to attempt to make an assessment now of the effect of this 13 month reduction in stabilising the economy.
We have received numerous representations from businesses, business representatives and consumers on issues associated with the reduction in the rate of value added tax to 15 per cent. and its impact. We are acknowledging comments and responding to specific queries.
The total number of VAT registered traders is available from the VAT National Statistics bulletin published at:
An assessment of the anticipated impact of the reduction in the VAT rate on consumer spending behaviour can be found in paragraphs 2.40 to 2.45 in the 2008 pre-Budget report.