VAT travesty

oN SATUrDAy, we, along with numerous other small family businesses up and down the country, received a letter from hMrC telling us the flat rate for VAT was to increase from 12.5 per cent to 16.5 per cent — a 33 per cent rise.

This is a huge amount for small businesses to find in an already difficult economic climate. The rate is applied on certain businesses (ours is fish and chips) and starts once your turnover reaches £81,000 up to £225,000.

At the moment, this means anything between £10,125 a year up to £28,125. With this new increase, it will go from £13,365 up to £37,125. This is equivalent to a minimum of £62.31 a week and could rise to a staggering £173.01.

This dwarfs the planned but rescinded 1 per cent increase in National Insurance contributions for the self- employed. This money is coming straight from the pockets of the people the government claims to support. It will result in staff being laid off or getting their hours cut.

Most people employed in small businesses use the income to supplement the main wage earner in the family and this will now be either reduced or disappear entirely as businesses look to find the money from existing turnover. It’s an absolute travesty.

CARL HEERY, Buxton, Derbys.