Harrods: Halt rise in VAT

Harrods today called the Government's plan to increase VAT during the January sales a policy made by a "congenital idiot".

Michael Ward, managing director of the department store, said Chancellor Alistair Darling had to heed retailers' pleas to hold off raising prices until after the key shopping period. VAT was temporarily reduced from 17 per cent to 15 per cent last December as part of an emergency package aimed at kick-starting the economy.

The cut is due to be reversed on New Year's Day, but struggling retailers say its timing will cause huge practical problems and discourage shoppers.

Mr Ward said Harrods had set up a task force to cope with the tax rise.