£7 is more than I pay
in total for a kettle!
http://direct.asda.com/george/home-garden/kettles/george-home-1-7l-cordless-kettle-white/001592064,default,pd.html
VAT isn't only charged on luxuries. It's charged on ALL goods and services, with just a few exceptions (such as most types of food and also children's clothing).
Using your argument, Trt, it could be argued that I shouldn't have had to pay VAT to a glazier today because putting glass where I'd only had cardboard for the past ten days probably isn't really a 'luxury'.
Similarly, buying basic adult clothing (such as a £6 pair of jeans from Asda) probably isn't a 'luxury' but there's still £1 of VAT in that total price.
Also, if you didn't have a kettle you'd still need to a pan to boil your water in and you'd have to pay VAT when you purchased the pan. Even domestic fuel bills have VAT on them (although, admittedly, only at 5%) and most people wouldn't regard heating their homes, or having electric light, as a 'luxury'.