“Backdown on Pasty VAT. I feel such a fool for hoarding all those hot pasties now.” – Graeme Garden
Budget 2012 promised that all takeaway food sold above ambient temperature would be subject to VAT at the standard rate.
This was aimed at some bakers and supermarkets who had been selling hot pasties, pies and rotisserie chickens with VAT applied at the zero rate. They argued the goods weren’t sold hot for consumption, but rather for presentational or health and safety purposes.
Predictably there was an outcry. A tabloid newspaper even hired an actress dressed as Marie Antoinette to follow Mr Osborne around.
So he changed his mind.
Pasties and other bakery items will no longer attract VAT if they are “cooling down” after being removed from the oven.
That leaves the rotisserie chicken as the major casualty of fiasco.