There is rising unemployment in the UK. It is estimated that the unemployment rate may be as high as 19.8 per cent for the age group 19-24 years. The rise in the number of jobless was almost entirely driven by the public sector due to the Government's austerity measures. The inflation rate has also escalated.
Against this background, the UK Government will be raising Vat to 20 per cent from January 4, 2011.
With the demands made here on the Treasury by public sector workers and other groups, the Minister of Finance may be forced to follow his British counterpart and also impose Vat at 20 per cent.
Imaam Iqbal Hydal
Felicity