2011 VAT rise no longer an inflationary factor says ONS

The UK inflation rate fell sharply in January, to 3.6% from 4.2% the month before, as the impact of last year's VAT rise dropped out of the figures.

Consumer Prices Index (CPI) inflation in the UK fell to 3.6% in January, down from 4.2% in December, according to the Office for National Statistics (ONS).

Phil Gooding from the Office for National Statistics said that the major change behind the change in inflation rate was the increase of VAT in January 2011.

"This led to upward pressures on prices between December 2010 and January 2011 and those pressures were not repeated this year," Mr Gooding said.