By . Amanda Williams . PUBLISHED: . 21:31 EST, 7 April 2013 . | . UPDATED: . 06:44 EST, 8 April 2013 . The price of a first class stamp could soar to £1 in just three years if Royal Mail is privatised, a group campaigning against the move has said . The price of a first class stamp could soar to £1 in just three years if Royal Mail is privatised, campaigners claim. Save Our Royal Mail - set up by charities and pensioner groups to fight the expected sell off - said the cost would increase because other companies would be able to challenge Royal Mail's VAT-free status under competition law. Bankers and government ministers are . paving the way for a Royal Mail flotation. It is believed it could . happen as early as the Autumn. Stamps are exempt from  VAT but lawyers have warned that if the Royal Mail is privatised, this exemption will be challenged – almost certainly successfully – by other delivery companies. The price of sending a first class letter last year rose from 46p to 60p - an increase of 30 per cent. If 20 per cent VAT was added the price would increase to 72p. A further rise of 30 per cent would see the stamp cost 94p by 2015. The group has warned that even if VAT were not applied, the price of sending a first class letter would 'likely hit £1 in three/four years, assuming two increases in that period', The Daily Telegraph reports. Brian Binley, a Conservative MP and member of the Business Innovation and Skills Committee - which oversees the work of Royal Mail -  told the paper it was essential that the services currently enjoyed by the public can be guaranteed, before the Government rushes into selling off the group. He added: 'This should include a very careful look at how future price rises will adversely affect businesses as well as people in counties like Northamptonshire.' Bankers and government ministers are paving the way for a Royal Mail flotation. It is believed it could happen as early as the Autumn . A Business, Innovations and Skills spokesman said the Royal Mail will continue to be the designated universal service provider regardless of its ownership. They added that any change would not 'trigger a change in the current VAT exemption which applies to first and second class stamps as part of the one price, anywhere service.' The Royal Mail can trace its origins to 1516, when Henry VIII established the office of Master of the Posts - a rudimentary postal service. But the monarch and his courtiers were the only ones allowed to use it. In 1635, a Staffordshire merchant called Thomas Witherings asked Charles I for permission to run a proper state postal monopoly, open to ordinary people as well as the rich and powerful. The General Post Office was founded in 1660 by Charles II. During the Civil War, at the first Post Office in central London, Cromwell’s men set up a secret room where letters were opened, copied and resealed. Roundhead agents pored over the nation’s letters, looking out for any signs of dissent. After the war the service was returned to the public. By the time of Queen Victoria, in 1837, the Post Office had become a crucial part of Britain’s booming industrial landscape, with sub-post offices the hub of Victorian communities. The Royal Mail was once so vital to daily life, that post men delivered up to six times a day. A spokesman for HM Revenue and Customs declined to comment on speculation. A Royal Mail spokesman said: 'Stamp prices, whether set under public or private ownership, are subject to significant competitive pressures. 'Customers have many alternatives to the post and there are now many postal providers. It is pure speculation to suggest that stamp prices could reach £1 in the next few years – in fact in 2013 there was no increase in the price of first class or second class stamps. 'UK stamp prices are among the best value in the EU. In some cases, the UK is the cheapest.' The spokesman added: 'Clearly, the rules governing the implementation of VAT are a matter for HMRC not Royal Mail. 'VAT exemptions for core postal service delivery products such as stamps, by Universal Service Providers (USP), are in place in the vast majority of EU countries under the European VAT Directive. 'Under the Postal Services Act 2011 Royal Mail is the USP in the UK. The VAT exemption would apply regardless of whether Royal Mail was in public or private ownership. Similar VAT exemptions are in place for Universal Service products in Germany, Austria and the Netherlands. In each country the USP is privately owned.' Save Our Royal Mail is backed by the Countryside Alliance and the National Pensioners Convention, among others. The postal union the Communication Workers Union is believed to have contributed towards the cost of the campaign group's website. It will be launched today. The CWU said in a statement: 'Privatisation often leads to higher prices, fewer services, and lower standards. It also risks a 'race to the bottom' when it comes to jobs, with redundancies and lower terms and conditions. 'This would be disastrous for postal workers and postal services. It would be a major step backwards, not an improvement. 'At CWU we believe that Royal Mail can be a successful company and remain in public ownership; protecting valuable postal services for all communities. We don't believe there are convincing arguments linking privatisation with greater success and we would like to see continued innovation under public ownership.' Over the past five years the volume of . letters sent every day has fallen by 10 million as people increasingly . rely on other methods of communication such . as email.
Save Our Royal Mail warns companies could challenge VAT-free status .
Bankers and ministers are .
paving the way for a Royal Mail flotation .
The price of sending a first class letter last year rose to 46p to 60p .
By . Amanda Williams . PUBLISHED: . 21:31 EST, 7 April 2013 . | . UPDATED: . 06:44 EST, 8 April 2013 . The price of a first class stamp could soar to £1 in just three years if Royal Mail is privatised, a group campaigning against the move has said . The price of a first class stamp could soar to £1 in just three years if Royal Mail is privatised, campaigners claim. Save Our Royal Mail - set up by charities and pensioner groups to fight the expected sell off - said the cost would increase because other companies would be able to challenge Royal Mail's VAT-free status under competition law. Bankers and government ministers are . paving the way for a Royal Mail flotation. It is believed it could . happen as early as the Autumn. Stamps are exempt from  VAT but lawyers have warned that if the Royal Mail is privatised, this exemption will be challenged – almost certainly successfully – by other delivery companies. The price of sending a first class letter last year rose from 46p to 60p - an increase of 30 per cent. If 20 per cent VAT was added the price would increase to 72p. A further rise of 30 per cent would see the stamp cost 94p by 2015. The group has warned that even if VAT were not applied, the price of sending a first class letter would 'likely hit £1 in three/four years, assuming two increases in that period', The Daily Telegraph reports. Brian Binley, a Conservative MP and member of the Business Innovation and Skills Committee - which oversees the work of Royal Mail -  told the paper it was essential that the services currently enjoyed by the public can be guaranteed, before the Government rushes into selling off the group. He added: 'This should include a very careful look at how future price rises will adversely affect businesses as well as people in counties like Northamptonshire.' Bankers and government ministers are paving the way for a Royal Mail flotation. It is believed it could happen as early as the Autumn . A Business, Innovations and Skills spokesman said the Royal Mail will continue to be the designated universal service provider regardless of its ownership. They added that any change would not 'trigger a change in the current VAT exemption which applies to first and second class stamps as part of the one price, anywhere service.' The Royal Mail can trace its origins to 1516, when Henry VIII established the office of Master of the Posts - a rudimentary postal service. But the monarch and his courtiers were the only ones allowed to use it. In 1635, a Staffordshire merchant called Thomas Witherings asked Charles I for permission to run a proper state postal monopoly, open to ordinary people as well as the rich and powerful. The General Post Office was founded in 1660 by Charles II. During the Civil War, at the first Post Office in central London, Cromwell’s men set up a secret room where letters were opened, copied and resealed. Roundhead agents pored over the nation’s letters, looking out for any signs of dissent. After the war the service was returned to the public. By the time of Queen Victoria, in 1837, the Post Office had become a crucial part of Britain’s booming industrial landscape, with sub-post offices the hub of Victorian communities. The Royal Mail was once so vital to daily life, that post men delivered up to six times a day. A spokesman for HM Revenue and Customs declined to comment on speculation. A Royal Mail spokesman said: 'Stamp prices, whether set under public or private ownership, are subject to significant competitive pressures. 'Customers have many alternatives to the post and there are now many postal providers. It is pure speculation to suggest that stamp prices could reach £1 in the next few years – in fact in 2013 there was no increase in the price of first class or second class stamps. 'UK stamp prices are among the best value in the EU. In some cases, the UK is the cheapest.' The spokesman added: 'Clearly, the rules governing the implementation of VAT are a matter for HMRC not Royal Mail. 'VAT exemptions for core postal service delivery products such as stamps, by Universal Service Providers (USP), are in place in the vast majority of EU countries under the European VAT Directive. 'Under the Postal Services Act 2011 Royal Mail is the USP in the UK. The VAT exemption would apply regardless of whether Royal Mail was in public or private ownership. Similar VAT exemptions are in place for Universal Service products in Germany, Austria and the Netherlands. In each country the USP is privately owned.' Save Our Royal Mail is backed by the Countryside Alliance and the National Pensioners Convention, among others. The postal union the Communication Workers Union is believed to have contributed towards the cost of the campaign group's website. It will be launched today. The CWU said in a statement: 'Privatisation often leads to higher prices, fewer services, and lower standards. It also risks a 'race to the bottom' when it comes to jobs, with redundancies and lower terms and conditions. 'This would be disastrous for postal workers and postal services. It would be a major step backwards, not an improvement. 'At CWU we believe that Royal Mail can be a successful company and remain in public ownership; protecting valuable postal services for all communities. We don't believe there are convincing arguments linking privatisation with greater success and we would like to see continued innovation under public ownership.' Over the past five years the volume of . letters sent every day has fallen by 10 million as people increasingly . rely on other methods of communication such . as email.
privatised, campaigners claim. Save Our Royal ministers are . paving the way for a Royal Mail companies. The price of sending a first class letter last year rose from 46p to 60p - an Northamptonshire.' Bankers and government