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Government redefines hot pasties to keep them free from VAT

Government redefines hot pasties to keep them free from VAT

It is believed that the Government has bowed to public pressure and is to do a U-turn on its plans to impose the pasty tax. Furthermore, the intended 20% VAT charge, which was going to be imposed on static caravans is to be reduced to 5%.

Bakers and caravanning enthusiasts have been vocal in their disapproval of George Osborne’s plans to impose VAT on Cornish Pasties and static caravans. The government has now already its definition of a hot pasty in order to save face but Labour was quick to say that ministers were “incompetent”.

Under the amendment, foods such as pasties and sausage rolls that are cooling down will not be subject to VAT. Under the current regulations, most food and drink does not attract VAT, but takeaway food designed to be eaten hot does.

The problem of ambient temperature had caused a lot of debate. Sheryll Murray, the Tory MP for South East Cornwall, was concerned that an army of tax inspectors, wielding thermometers, would start invading bakers’ shops to poke around in pasties.

A spokesperson from the Treasury said that the Budget announcement was designed to take away the ambiguity in the current system and leave a level playing field for the takeaway food market. After extensive consultation, the government has improved its initial policy to make sure the new regime would be easy to apply.

However, Chris Leslie, the shadow Treasury minister, said the government should have thought the proposals through before announcing it is making new policies.

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Image: Cornish pasties by RaeAllen

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