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Friday, 18 April 2014

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Tax on hot pies is too much for Cumbrians

You can take our tax-free allowances Chancellor, but don’t touch our pies.

Nick Stewardson photo
Nick Stewardson from Gretna Bakery

That’s the message from the Cumbrian food industry on plans to slap VAT on pies, pasties and sausage rolls.

George Osborne revealed in last week’s Budget that the Government intends to add a 20 per cent sales tax to hot take-out food.

The tax is due to come into force in October, although bakery giant Greggs and the big supermarkets have vowed to fight to overturn it.

Andy Routledge, who runs bakery Routledges, on Wigton Road, Carlisle, said: “My heart sank when I heard this announced. A 20 per cent price rise is massive. It’s going to mean an extra 18p on a pie and maybe 7p or 8p on a sausage roll. People will definitely notice that and they’ll give us grief over it.

“I couldn’t just suddenly decide one day to put my prices up 20 per cent, but that’s exactly what the Government is asking us to do.

“People don’t understand it’s going to the Chancellor in tax– they think it’s going in my pocket.

“People will vote with their feet and stop buying, no doubt about it.

“I really worry about the affect this is going to have on the industry during an already difficult time for consumers.

“There’s still time to overturn this and my hope is that the bigger companies can use their influence to get this stopped.”

Nick Stewardson, of Aglionby, near Carlisle, runs bakeries in Gretna and Longtown and the W Sproat and Son bakers on Lowther Street, Carlisle.

He believes bakeries have been able to escape VAT on hot take-out food for too long by exploiting a legal loophole.

“I think this is a lot of nonsense about nothing,” he said. “Takeaway outlets like fast food shops have had to pay VAT for over 20 years, but bakeries got round it by having ovens in their shops and selling goods while they’re hot.

“If you let them cool and then reheat them, then you do have to pay VAT because you’re adding value.

“I don’t have ovens in my shop so I’ve always reheated some products and therefore I’ve always paid a percentage of VAT.

“I don’t think this will put people out of business, it will just mean the big bakeries like Greggs have to compete with rivals like McDonald’s on an equal footing – they’ve had an unfair advantage for too long.

“My real fear is that they will not be able to define what hot food is and they will just slap VAT on all foods which I suspect is what they want to do anyway.”

Cumbrian celebrity chef Annette Gibbons said she fears the tax could force some of the county’s independent pie makers out of business.

“I’m concerned about the damage this could do to some of the fantastic artisan bakeries we have here,” she said. The bigger producers will probably cope, but this will unfairly penalise the smaller companies.

“It seems to me the Chancellor is victimising people on lower incomes.”

Jane Black, 40, of Dalston, is a regular bakery customer.

She said: “I think this is wrong, especially with the economy the way it is.

“Occasionally, I pop in to the bakers to get some sausage rolls for the kids if they’ve just finished school and are rushing off somewhere else. I don’t see why I should have to pay money to the Government for the pleasure.”

Clare Allen, of Burgh by Sands said. “This does seem unfair, but the Government has to raise revenue from somewhere. I don’t think it’s right to say it targets the poor, rich people buy pies as well.”

Have your say

First pies....what next I can see the clean air tax coming in which will be if you breath clean air you will get taxed!!

I can only hope that there is a shake up in the next elections both nationally and locally else I think I will stand as an independent I certainly couldnt do any worse!

Posted by Pieman on 9 April 2012 at 00:21

Perhaps bakeries, in order to avoid having to charge and pay VAT on hot food, could branch out into 'selling' microwaves and small ovens. Customers could then make an informed decision on whether to buy one or not by placing their 'cold' pies in them to see how they (the ovens) perform.

Posted by BM on 5 April 2012 at 13:55

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