Responding to Michael Gove’s promise to scrap VAT if he was to become the next Prime Minister, Leader of the Liberal Democrats Vince Cable said:
"Michael Gove is clearly on par with other candidates in the Tory leadership race who have put forward equally ludicrous proposals. Any remaining claims the Conservatives had for having some fiscal responsibility has gone down the drain.
"VAT is an essential part of our tax system which raises vast amounts of revenue. Due to the zero rate exemption low income families are protected from the worst effects of the consumption tax.
"There is a strong argument for raising the threshold due to the bureaucracy it creates for small businesses, but this is a very different matter from scrapping it entirely."