British Parliament In Revolt Over Pasty Tax!

Cornish Pasty

OK so this is just for a little fun, every now and again something symbolic happens which seems to have a much wider effect than it should.  I’m not saying the pasty tax is ever going to lead to the scenes following the Boston Tea Party (1773) or recreate the War of Jenkins Ear (1739), but in a week when the Prime Minister is quoted at an event about the Olympic Games as saying “I'm a pasty eater myself” before defending the tax it’s got all the making of a true national farce.

What is the Pasty Tax?

The so called pasty tax relates to the level of VAT (Sales Tax) levied on goods and services.  Traditionally, the decision whether to apply VAT or not relates the question of whether or not an item of food is sold hot or cold.  Foods served hot are considered a luxury item and have VAT levied on them, foods served cold are considered as basic and so don’t attract the levy.  In short, you’ll pay VAT on your fish and chips but not on a sandwich.

The so called pasty tax is effectively a reform of the tax system aimed at closing a loophole on the sale of hot baked goods available at bakeries and in the supermarkets.  Under the reforms, the tax would now be levied on baked goods which were served hot in such outlets but not those served cold.  So if going to buy a pie, pasty or other baked items from Greggs, buy it hot and it will cost 20% more than the same item sold cold!

The Pasty Tax, What’s The Fuss?

The government and David Cameron have argued that the reforms simply reflect a fairer application of the system which has traditionally governed whether of not the tax is levied on an item.  However, the press and those with a vested interest in not paying the tax have accused the government of being out of touch and introducing a tax on the poor.

Key opponents of the tax include Ken McMeikan CEO of the bakery chain Greggs who saw millions wiped of its shares following the decision.  Other opponents include those representing the Cornish pasty industry, now set to see a rise in costs associated with the tax.  However, some have capitalised upon the media’s coverage of the event with Gavin Williams of the West Cornwall Pasty Company quoted as reacting to Cameron’s comments with “We thank him for his glowing endorsement of our quality product and for helping to spread the news that a West Cornwall Pasty Company pasty is the best around.”