Page last updated at 15:20 GMT, Wednesday, 5 January 2011

Labour and Tories clash over VAT increase

The government claims the hike in VAT from 17.5% to 20% will hit the rich hardest, Labour claims it will hammer the poor. Chancellor George Osborne insists it is a tough but necessary step, Shadow chancellor Alan Johnson warns that it will put the economic recovery at risk.

David Grossman reports on a classic political dispute.

Broadcast on Tuesday 4 January 2011.

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