Sunak to cash in £40 billion VAT windfall as families face cost of living crisis

Rishi Sunak set to rake in an extra £38.6 billion in VAT over next four years due to soaring prices Typical family to pay £430 more in VAT next year, on top of National Insurance rise coming into force today Lib Dem Leader Ed Davey launches local election campaign with call to slash VAT and save struggling families £600 The Chancellor Rishi Sunak is set to rake in an extra £38.6 billion in VAT over the next four years, as skyrocketing inflation leads to higher prices in the shops, official forecasts have revealed.   Analysis by the Liberal Democrats shows this means a typical family will pay an estimated £430 more in VAT next year, compared to what they paid in 2021-22. The figures are taken from the latest forecasts from the Office for Budget Responsibility.    The tax raid comes on top of the Conservative government's manifesto-breaking increases to Income Tax and National Insurance, which come into force today and are set to leave the typical family £535 a year worse off even before the extra VAT hits.  Liberal Democrat Leader Ed Davey will put the issue at the heart of the party’s local elections campaign today (Wednesday 6 April), urging the government to tackle the cost of living crisis by cutting taxes for struggling families. The Liberal Democrats are calling for an emergency cut to VAT, slashing the top rate from 20% to 17.5% for one year, a move that would save families an average of around £600. The plans would also give a boost to struggling high street businesses by encouraging spending, and help keep inflation under control by reducing prices in the shops. Speaking ahead of the party’s local election campaign launch today, Liberal Democrat Leader Ed Davey said:   “Families are facing soaring energy bills and desperately need a tax cut to help them make ends meet. But instead of helping, the Conservatives are breaking their promises by raising taxes again and again.   “These elections are an opportunity to send a message to this Conservative government  that they can’t afford to take people for granted any longer. “Right across the country, people are turning to the Liberal Democrats because they know we will listen and stand up for you and your community. We will fight for a fair deal that puts money into the pockets of struggling families through an emergency tax cut.”