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Is the budget enough for you to start spending again?

While the government has done its bit to try and kick-start the UK economy it appears that the success or failure of the latest plan is down to the UK consumer. However, even at this early stage there are grave concerns that a 2.5% reduction in VAT will have little or no impact on the high street and consumers will continue to hold back on purchases until prices hit rock bottom. There is even a suggestion that many will use the savings on offer to pay off their mortgages and reduce their financial worries.

While it is understandable that some may want to use the savings produced by the budget in order to reduce their financial liabilities this will not get the country moving again and will in many ways defeat the point. There are also claims from the retail industry that changing systems to take into account the new 15% VAT rate would be an expensive project in itself.

At the moment it seems that each and every where the government turns there are arguments and counterarguments in favour and against their plans, however the bottom line is that until the consumer feels comfortable enough to spend again the UK economy will not recover.

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