VAT cut helped UK’s poorest

The temporary cut in VAT in December 2008 benefited the poorest UK households more than the richest, according to the Office for National Statistics (ONS). The proportion of the poorest fifth of households’ income taken by VAT plummeted from 12.1 per cent in 2007-08 to just 9.8 per cent in 2009-10 – its lowest rate since 1991. The richest quintile spent just 5.3 per cent of their income on VAT in 2009-10.