News from Labour Matters

Sarkozy, who said UK’s VAT cut achieved nothing, cuts VAT

LabourBoy takes European leaders who criticised Gordon Brown’s credit crunch plans to task, noting that they’ve copied him after all. Most notable is a report in The Guardian which reports that France’s Sarkozy, who said that our VAT cut achieved nothing, which was trumpeted at the time by the Tories as a vindication of their own ‘do nothing’ approach, has decided to cut VAT in France:

“Recently French President Nicolas Sarkozy criticised the UK government’s VAT cut saying it achieved absolutely nothing, in defense of his own policy of infrastructure projects rather than tax cuts (or both).

Now, weeks later, restaurant meals in France have had their VAT cut to 5.5% in a bid to boost consumer spending.

It’s not as wide-ranging as Britain’s VAT cut, but the premise behind it is exactly the same – encourage consumer spending whilst supporting business.”

Read the full article.

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