THE owner of Northamptonshire’s largest independent bakery has said the Government’s so-called ‘pasty tax’ would be an ‘unmanageable nightmare’.
Thomas Adams runs the Northampton-based Oliver Admas bakery, which has almost 20 shops in the county as well as others in Buckinghamshire and Warwickshire.
He said the changes to VAT rules announced in the budget, which will see food sold ‘above ambient temperature’ carry 20 per cent VAT, would be impossible to implement.
He said: “We bake our sausage rolls and pasties in our shops. We can’t sell raw sausage rolls, you have to sell them baked and when they come out of the oven, they’re hot.
“We could let them go cold before selling them, but where is the line about how hot things can be actually going to be drawn?
“It’s going to be a nightmare.”
Chancellor George Osborne announced the tax change in the budget claiming it would remove an anomaly which means supermarkets do not have to include VAT on hot food, but takeaways such as fish and chip shops do. The campaign against the tax has been led by the national high street chain, Greggs, who have argued it would cause job losses.
Mr Adams admitted that if the tax was introduced, independent bakers would probably have to put their prices up.
He said: “I don’t think there’s any room for us to absorb the VAT rise. We would have to find a way of getting it back through the price. That would inevitably have an impact on how much we sell and that’s a big concern which will affect hundreds of small businesses across the country.”
He also highlighted flaws in the proposals by questioning whether things like mince pies and Eccles cakes would have VAT included on them if they were sold warm.
He said: “At Christmas, we bake thousands of mince pies and people buy them fresh. Who’s going to decide if they’re subject to VAT or not? We could of course just let everything go cold before we sell it, but people prefer things warm.”
A petition against the tax is in all of Mr Adams’s shops. The Government’s consultation on the plans runs for the next six weeks.
– Behind the Headlines, page 16