Shadow business secretary Kenneth Clarke has signalled that a Conservative government would be ready to raise taxes – including VAT – if they win this year’s general election.
In an interview with the Sunday Telegraph, Clarke said it would be “folly” to rule out tax rises alongside cutbacks in public spending to help cut Britain’s deficit.
He said: “In order to maintain the confidence of the markets and to create conditions for growth and employment, then you may have to look at tax increases.”
On VAT, which some commentators expect the Tories to raise to 20% at least temporarily if they win power, Clarke said: “We will try to avoid it, we’ll minimise it if we have to by having proper control of public spending, which we haven’t had in this country in the last 12 years.”
The VAT rate returned to 17.5% on January 1.