FF backbencher calls for VAT to be slashed

A FIANNA Fáil TD has urged Finance Minister Brian Lenihan to slash VAT for a trial period in the next budget to see if it persuades people to spend more money.

Michael McGrath, vice chair of the Oireachtas finance committee, said VAT rates should be cut on a “use it or lose it” basis to stimulate consumer spending.

Mr Lenihan increased VAT from 21% to 21.5% in the emergency budget last October in a desperate attempt to bump up the tax take for the state coffers.