UK Chancellor, Alistair Darling, announced his 2008 Pre-Budget report today.

Amongst government measures intended to beat the recession, Value Added Tax is to be cut from 17.5% to 15% from 1 December 2008 until 31 December 2009. Alcohol and tobacco prices will not fall, as duty on them will be increased to match the VAT cut.

The government’s plan is to boost the economy through greater spending. Cut VAT now, to convince us that prices are going to go up later, thus encouraging us to spend, spend, spend.

But will these measures work?

Many people have borrowed heavily recently, and may now be tempted to pay off debt.  Others may save up for a rainy day rather than buy more goods in the shops, conscious of the fact that higher government borrowing now, will eventually have to be paid back.

It’s already coming up to a year since I bought my Ibiza.  Last week the car started telling me that it would like a service by displaying a little spanner icon in the mileometer.  A few days later I received a letter from my local SEAT dealer inviting me to book the car in with the service department.  I suppose I’m going to have to sort something out soon.

I’ve received docs from the DVLA about renewing the tax disc too.  I’ve just used their online renewal service, which was quick and relatively painless.  It’s much better than trudging into town and queuing up at the Post Office with my V11 form and insurance certificate.  There is a £2.50 fee for paying by credit card and as I’m already having to pay £120 duty for a 12 month licence I opted to pay by Switch for no extra.  Apparently the disc should arrive by First Class post within the next five days.  Then I’ve just got to make sure I don’t lose it before the beginning of next month.