The Debate on the 20% ‘Pasty Tax’ Continues

Following the National Association of Master Bakers’ recent submission of a 10,000-signature petition in London, the Government has entered into a period of consultation.  The N.A.M.B. hopes the discussions will result in a workable solution for the 20% ‘Pasty Tax’.

The 20% V.A.T. tax, which is being introduced to close the loop hole that exists in respect of heated food, is one of the many initiatives the Government is hoping to put in place to claw back some of the country’s deficit. The tax will affect the bakery community significantly and they have therefore proposed a more workable solution.

The N.A.M.B.’s alternative proposal recommends that 20% V.A.T. should only be added to products which have:

  • Been in a heated environment after baking.
  • Been re-heated to order.
  • Been supplied in heat-retaining packaging.

This will prevent the current confusion regarding ‘ambient air temperature’, as a definition of hot food, which would be unworkable and unenforceable.  The simplified definition states that any freshly baked product will not be subject to V.A.T., as long as it is not kept in a heated environment once baked.

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