Vat Attack!

So, despite pre-election pledges, that's the VAT gone up, meaning that a fairly hefty 20% of certain types of purchase goes to the government. Whether this will haul the country from recession remains to be seen.

Yes, as Alan Sugar says at the start of every episode of the Apprentice, these are tough times economically. But the VAT rise doesn't necessarily mean that we're going to be too poor to afford anything. What I reckon it will mean is that manufacturers and retailers might have to absorb some of the VAT rise - I mean, how come designer clothing can go into a sale at half price?

Other not so great news is that rail fares have gone up, despite some of the UK's rail services being unarguably poor. Anyone who has travelled for more than an hour on most UK routes will have their story to tell.

So will 2011 be the enemy of cheapness? In some respects it looks like it, but if the retailers respond intelligently, it might not be so bad.