‘Pasty tax’ controversy heating up

THE WAR of words over the so-called “pasty tax” heated up yesterday as the Prime Minister defended the decision to charge VAT on hot food served by shops and supermarkets.

David Cameron said that the move — which will add 20% to the cost of hot pies, pasties and bridies — would defend takeaway restaurants against competition from major chains.

It comes following huge criticism of the plans by the chief executive of bakers Greggs, which saw millions of pounds wiped off its shares following the announcement in last week’s Budget.

Yesterday Mr Cameron said: “It was Nigel Lawson who, over 20 years ago, put VAT on hot takeaway food and many pasties and other items of hot takeaway food have hadvat on them since that time.

“I don’t think it is fair that the small businessman running a fried chicken takeaway is having to charge his customers VAT but the big supermarket isn’t hav- ing to pay VAT on fresh hot chicken.

“It’s about trying to have a sensible VAT arrangement where the boundaries are sensible.”

Ken Mcmeikan, chief executive of Greggs, has lashed out at Mr Cameron’s Government and the plans.

He said that ministers had “lost touch” and did not appreciate the impact the changes to VAT rules would have on ordinary people.

However, one Dundee butcher believes that customers will not be too perturbed by the levy, should it be introduced.

Gilbert Grossett believes that customers will continue to stick with hot baked goods, even IFVAT is added.

“I don’t think it will have any great impact,” he said. “We sell hundreds of pies and pastries every day.

“We start baking at seven in the morning and don’t stop until half past two in the afternoon.

“People from all aspects buy them, from school kids to pensioners and workers wanting something for lunch.

“They’re incredibly popular.”

David Cameron