The government’s decision to raise Vat will stifle growth and will see the poorest bear the brunt of the government’s ideological cuts, said Toby Perkins, MP for Chesterfield.

He added: “This is bad news for people and families across Chesterfield. It will hurt motorists as petrol prices and the cost of motoring will rise. It will hurt those families and pensioners when they go to the shops. And it will hurt small businesses many of whom will not want to pass on the increase in VAT to their customers”.

At a time when the economic recovery is already under threat, with latest figures showing growth stalled in the final quarter of 2010, the VAT hike is also a “jobs tax”. It is estimated that the VAT attack will hit 250,000 jobs, three times the number associated with Labour’s alternative to the VAT rise – an increase in National Insurance Contributions. “Already we have seen Tory policies push the economy back into negative growth and now we face the VAT rise on top. It’s the wrong tax at the wrong time”.

“In the General Election campaign George Osborne said the Conservatives had no plans to increase VAT and David Cameron acknowledged that VAT rises hit the poorest the hardest. We have been hearing a great deal about the Liberal Democrat’s u-turn on student fees. Well this is a Tory U-turn, with the hand break on. It is the people of Chesterfield that are being made to pay for it. It is yet another broken promise from this Tory government”

The decision to increase VAT costs for families across Chesterfield was supported by Liberal Democrats on Chesterfield Council who unanimously supported the rise in a motion placed before the Council’s July 2010 meeting.  Toby Perkins said: “Now we are just starting to see the way that this government’s policies are undermining the recovery. It is amazing that Lib Dems in Chesterfield should actually welcomed measures that will make ordinary Chesterfield people worse off.”