LONDON (Dow Jones)--U.K. retail stocks rose Tuesday after the U.K.'s coalition government announced a value-added-tax from next year but kept food and children's clothes exempt. VAT will increase to 20% from 17.5% Jan. 4, George Osborne said, delivering his first budget as U.K. Chancellor of the Exchequer. The rise to 20% was broadly expected by the retail industry, but the notice period and the fact that VAT wasn't extended to other product categories will soften the blow for high-street retailers and supermarket groups with non-food offers, PricewaterhouseCoopers analyst Mike Bailey said. At 1247 GMT, electronics group DSG International PLC (DSGI.LN) was up 4.8% at 29 pence, clothing, food and home ware retailer Marks & Spencer Group PLC (MKS.LN) was up 1.8% at 349 pence and supermarket group Tesco PLC (TSCO.LN) was up 1% at 392 pence. -By Simon Zekaria, Dow Jones Newswires; +44 207 842-9410; simon.zekaria@dowjones.com (END) Dow Jones Newswires June 22, 2010 08:57 ET (12:57 GMT)