High Street expecting VAT rise

High-street retailers are bracing themselves for a big rise in VATwhen the chancellor unveils

his emergency budget on Tuesday.

While retail lobby groups are still urging George Osborne to find other ways to fill the gap in the public finances – arguing that a VAT increase will stoke inflation and could stop the economic recovery in its tracks – many of the biggest high-street names now regard an increase from the current 17.5% to 20% as inevitable and are merely hoping to delay the rise.