Plymouth pasty makers welcome crimp on Government tax plan
A CLIMB DOWN on the controversial "pasty tax" will today be announced by the government.
News that the government is to change its plans to impose VAT on pasties has been welcomed with open arms by Plymouth-based pasty makers and politicians alike.
Plans to introduce VAT at 20 per cent on all hot food, including pasties, have been criticised by local MPs and pasty companies in the region since they were proposed.
But under revised proposals VAT is expected only to be charged on food intended to be served hot – omitting food such as pasties which are often cooked hot but left to cool in cabinets before being served.
Phil Abbott, company director at Plymouth pasty firm Ivor Dewdney, said: "It sounds like excellent news. The government has adopted the alternative that we proposed. They have gone with the proposal that we put forward, that if it's not reheated or kept in a heated cabinet it shouldn't have VAT put on it.
"If that's actually what these announcements bring then it's brilliant news for us – it means we would be back to pre-budget, without having to pass on the VAT to our customers."
Under the new proposals, VAT will still be charged on all food provided hot for the purposes of allowing it to be eaten hot, or food which is cooked hot to order.
VAT will also apply where food is kept hot in hot cabinets, hot plates, heat lamps etc or where heat is applied in order to slow the cooling process.
It will also apply where food is provided in heat-retaining packaging or other packaging specifically designed for hot food – an example would be foil-lined takeaway packaging for Indian and Chinese takeaways. Food advertised as hot is also subject to VAT.
Sheryll Murray MP for South East Cornwall, who defied the party leadership to oppose the change to tax rates, said: "I am so pleased we have a government that listens. I told the government that I didn't want to see an army of thermometer wielding tax inspectors poking our pasties and that I was really concerned about the vagaries of ambient temperature. They listened.
"I constantly get people into my surgery and when I say there is a consultation they always turn around and say they won't listen. This proves them wrong. Anyone who criticises the fact that the government has changed its opinion clearly does not want government that will listen to the people."
Meanwhile Councillor Tudor Evans, Plymouth City Council's Labour Leader, said: "The Pasty Tax U-turn is a victory for the Westcountry against out of touch Tories. Not only is the pasty a symbol of Westcountry identity but local jobs were put at risk by the Tories decision to impose a 20 per cent tax on our pasties. I congratulate all those local businesses and individuals that joined with Labour to oppose this tax."
Alison Seabeck, Labour MP for Plymouth Moor View, who also went against the party line to oppose the controversial tax, said: "George's Osborne's Budget gave millionaires tax cuts and put tax on pasties. This should tell you all you need to know about how out of touch the government has become. Whilst the Chancellor is in the mood for turning, perhaps now he should turn his attention to his woeful economic policies that have produced this double dip recession that is hurting businesses in Plymouth."