To want a reform of the VAT system

[ReallyTired]

I feel that people on low incomes are paying far too much VAT for every day life essentials like low cost clothes, hygiene products like sanitary towels, VAT on heating bills, and even semi essential things like a basic telephone/ broadband package.

I would like to see different bands of VAT for every day goods and luxury goods like an IPOD, new TV, high speed broadband, membership of gym, going to a resturant. I think it would help people who have a low disposible income.

I would also favour slaughtering some sacred cows like VAT on some foodstuffs. Some foods are basic like bread or fruit or meat should remain VAT free. However it would not do anyone any harm to be charged the luxury rate of VAT on high fat foods or crisps. I would also like to charge VAT on all items of clothing that costs more than a certain amount. If a parent can afford a designer coat for their child then they can pay more tax.

Such a measure would help families like these.

povertytrap.childrenssociety.org.uk/

Unlike expanding benefits there would be no shame or humilation or means testing. It would also make the money of those on benefits go further.

Ok. My restaurant, which supports my family and the family of 5 employees would close.

Sp we would all be on benefits. We are a bring your own to keep costs down and alot of low income people come in as an occasional treat.

Bare in mind that 20% of the bill in restaurant goes to the tax man in vat already.

In short yabu. These things won't help.

If a parent can afford a designer coat for their child then they can pay more

These sorts of things don't work, like the 50p tax rate.

you don't pay VAT on children's clothes anyway :S

Then its going to make it even harder for poorer people to save up and buy that gorgeous designer coat for their kids for christmas as they will have to pay tax on it. But if they bought the cheap coat then thats ok.

I think its right as it is re: clothes

I think YANBU about VAT on energy and sanitary products, and slightly YANBU on VAT bandings for essential and lux product groups.

I do think different VAT bands for essential and lux foods would be impossible to administer - you only have to cast your mind back to "pastygate" to realise that!

VAT is an EU issue, the government can't change it much anyway. It certainly can't remove move things from VAT.

removing Vat from sanitary towels, logo'd large sized school uniform and heating fuel would be the moral thing to do.

As would giving parents of children under 18 a voucher for two VAT free pairs of shies a year regardless of size.

shoes

Your scheme would also benefit the rich though and create an even bigger divide????

You also need to check up on your knowledge of VAT.

VAT on fuel is already at a reduced rate.
VAT on sanitary products is also at a reduced rate (although it should be zero regardles)
There is no VAT on childrens clothes or shoes -( the sizing should be taken into consideration however)
Meat and Veg are zero vat

"Your scheme would also benefit the rich though and create an even bigger divide????"

Why? Do the rich buy Tescos value brands? Or coats from ASDA?

In my experience poor people tend to spend their money on the basics and have very few luxuries. They tend to prioritise the basics, rather than having Sky TV. Poor people worry about putting food on the table.

Rich people tend to spend more money on luxuries because they can.

Changing VAT is a huge pain in the arse. Before being made redundant I worked in accounts. The recent rate changes created so much extra work. Extra work = extra cost. Businesses need to keep costs down to be able to afford to keep employing people

It would make the gap bigger because rich people would cut down on luxuries but still have them and the low income families would have any at all.