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Zero rating on food – unexpected results

03 April 2023 / Mike Thexton
Issue: 4883 / Categories: Comment & Analysis , VAT , VATA 1994 , VAT
Ours not to reason why

Key points

  • The definition of ‘food that should not be subject to VAT in 2023’ is effectively based on ‘food that was not subject to purchase tax in 1973’.
  • The rules in VATA 1994 Sch 8 Group 1 include seven ‘excepted items’ that are ‘food etc’ but are taken out of zero rating and seven ‘items overriding the exceptions’.
  • The most famous VAT case of all is about the difference between a chocolate-covered biscuit (excepted item) and a chocolate-covered cake (excluded in the wording of the excepted item).
  • ‘Food for human consumption’ seems fairly uncontroversial but there have been cases about aphrodisiac products edible flowers and aloe gel food supplements.
  • Liability of take-away food sold warm – aftermath of George Osborne’s pasty tax Budget.
  • Many problems in VATA 1994 Sch 8 stem from a political determination to hold on to the limited permission the UK had to...

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