Today the Tory-led government put VAT up to 20% - the highest ever level in Britain.

I think this is the wrong approach to deficit reduction.  New research has shown that retailers will lose £2.3 billion in sales revenue in the first three months of 2011 as a result of this rise. And VAT is not targetted - meaning that it will impact on low and middle income families the most.

It is the wrong tax, at the wrong time.

I am opposed to this tax rise. It is wrong and unfair for many reasons. It will hit the poorest hardest and hurt 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.

David Cameron admitted before the election that a rise in VAT would be unfair, and pledged that he had no plans to increase it if he became Prime Minister. This is just another of the government's many broken promises.

Instead of raising VAT, the government should have pushed for a higher banking levy, as Labour have called for. They seem to be forgetting that the economic crisis started in the banking sector, and wasn't caused by hard-working families who will now pay more VAT.

4 January 2011