Yorkshire bakery says local economy will be harmed by pasty VAT hike

Thomas the Baker has slammed the Government’s proposed Hot Food Tax branding it “impossible” and launching a petition against it throughout its 34 stores.

The family firm is asking customers to sign a petition to urge Chancellor of the Exchequer George Osborne to reconsider his proposal to apply 20% VAT to hot take away food amid fears it will be “impossible to police” and will ultimately damage the trade.



Under the proposed legislation, 20% VAT will be payable on all food served above “ambient” air temperature, including pies, pasties and toasted sandwiches, with HMRC estimating the change will bring in an extra £105m in annual revenues by 2013-14.

Simon Thomas, Thomas the Baker’s General Manager said:

As many of our loyal customer know, if you arrive at one of our shops just as the sausage rolls are coming out of the oven they will be hot, however, if you arrive half an hour later that same product will be cold. So who will determine if that product has dropped below ‘ambient’, and whether or not to charge VAT on it?

If you are behind the last person in the lunch time queue who just purchased an ‘ambient’ pasty without VAT, and then you buy a freshly baked pasty just as it comes out of the oven, you will be charged 20% more than the person in front of you. We will find this situation impossible to police.

The company, which has been selling fresh baked goods across York, Harorgate, North Yorkshire and Teesside for more than 30 years, plans to appeal to each of the local MPs based in its 34 regions and also launch an online petition.

 Turning up the heat – Simon Thomas, Thomas the Baker’s General Manager

 



Simon says it’s hard to guess what impact the proposed legislation will have on business but it’s likely Thomas’s, and other smaller operations, will lose trade. “We purchase prime, fresh, locally reared meats for all our pasties and pies from butcher Brian Thompson in Helmsley and flour from Bradshaws in Driffield, and both suppliers have had to pass on very significant increases in price as their raw material prices have increased. As a business we have done our best to absorb these and not pass them onto our customers, but it would be impossible for us to absorb the further 20% VAT increase.

Simon Thomas added:

There is no doubt that should the VAT increase be applied we will sell less products. In turn, many of our suppliers and many other local businesses will lose trade as a result. It certainly will not help the local economy.

 


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