John Lewis wins as shoppers get in ahead of VAT rise

Sales at John Lewis rocketed last week as shoppers rushed to buy furniture and electrical goods ahead of the increase in VAT.

The department store, which also runs Waitrose, said it benefited from the bank holiday on Monday January 3, the day before VAT rose to 20% from 17.5%.

It also said the lack of a new year snowfall helped its figures in comparison with last year, when much of Britain was blanketed in white.

Department store sales leapt 38.7% year-on-year, the biggest rise in the group's financial year which ends this month.

Several retailers have blamed bad weather for weaker than expected Christmas sales, the latest being Tesco yesterday.

But John Lewis, which has long outperformed the broader retail sector, has bucked the trend, helped by its more affluent customer base which is coping better with rising taxes and government spending cuts.

The group said homeware sales leapt 42.9%, while sales of electricals and home technology were up 38.3% and fashions up 35.1%. Online sales were up 42% and weekly sales at supermarket Waitrose were up 2.9% year-on-year.