Inflation rose to 4% in January, up from 3.7% in December.
According to figures from the Office for National Statistics, the two big factors which drove the Consumer prices index (CPI) were the VAT increase and the continued increase in the price of crude oil.
The British Retail Consortium (BRC) said the figures implied that retail was not the source of inflationary pressure, with Shop Price Inflation running behind both CPI and RPI at 2.5% in January.
Downward pressures came from clothing and footwear, with prices falling slightly more between December and January than the same period the year before.
The Retail Price Index inflation was 5.1% in January, up from 4.7 per cent in December.