Prime Minister's question asked in the House of Commons, by Lord Cameron of Chipping Norton (Conservative). It was answered on Wednesday, 26 November 2008 on behalf of the Prime Minister.

Engagements

Question: May I join the Prime Minister in paying tribute to Marine Alexander Lucas, who was killed in Helmand province on Monday? Our thoughts should be with his family and his fiancée at this time. We should also pay tribute to the incredibly brave marine, reported in today's papers, who rugby-tackled a suicide bomber and saved literally dozens of his colleagues from death. The bravery of our armed forces is something that we can all be incredibly proud of. If the Government do not have a secret plan to increase VAT, can the Prime Minister tell me why the Financial Secretary to the Treasury put his signature to it?

Answer: We looked at every option over the last few weeks, including options that were taken up by the last Conservative Government, and we rejected the proposal to raise VAT, in favour of a proposal to lower VAT. Let me tell the House why. We looked at the 1980-83 recession, and we found that when the Conservatives raised VAT from 8 to 15 per cent., hard-working families were hurt. We looked at the 1990s and found that when the Conservatives raised VAT from 15 to 17.5 per cent., hard-pressed families were hurt. When the Leader of the Opposition was an adviser to the Treasury, it tried to raise VAT on fuel to 17.5 per cent. We looked at all options, as the Chancellor said. We rejected the option of raising VAT; we decided we would lower it, and I hope that the Conservative party will support us.

Secondary information