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Value Added Tax

Over the past year, major shocks have hit the economies of every country in the world, and the economic and fiscal climate is exceptionally challenging, but the macro-economic framework that we put in place in 1997 means that we face these shocks from a strong foundation. Our priority is to support the economy—to support families and businesses—through these difficult times. We are navigating a path to get Britain through this in the best possible shape, and to do it in a way that is fair to everyone. Therefore, in the pre-Budget report, my right hon. Friend the Chancellor set out measures to help businesses and home owners, and to boost people's incomes now. We are acting by putting money into the economy now so that we come out of this situation sooner and stronger. We have set out how, once the economy is growing again, we will deal with the public finance problems caused by the credit crunch in a way that, again, is fair to everybody. We are acting now, unlike the Opposition, who would turn their backs on families and businesses at just the time they need support most. We are acting, because if we do not act now it will cost more—it will cost more to the economy, more to the public finances and more to society.