Wednesday, 16 April 2014

The "Pasty Tax" and the West Cornwall Pasty Conpany

My article in this week’s Cornish Guardian looks again at the impact of the Coalition’s “Pasty Tax.” It is as follows:

It is almost exactly two years since hundreds of people marched through the streets of Falmouth – in truly appalling weather – to protest at the Coalition’s “Pasty Tax.”

Readers of the Cornish Guardian will remember how, in his 2012 budget, the Chancellor of the Exchequer came up with a “half-baked” scheme to impose 20% VAT on hot food such as sausage rolls or pasties.

You may also recall that the Chancellor was ridiculed for telling “hard-pressed Brits” to “avoid his VAT hike on hot food by buying cold pasties.”

Opposition was widespread and it was pointed out, time and time again, that it would have a damaging impact on businesses and jobs – especially in Cornwall.  

Central government did partially back down and in the process redefined what it considered to be a “hot” pasty. It announced that pasties sold on shelves, while cooling down to an “ambient temperature,” would not be liable for VAT. But VAT would be charged on pasties kept hot in special heated cabinets.

Local MPs and activists from the Coalition parties were clearly relieved with the limited climbdown and merrily trotted out the line that we were lucky to have a Government which “listens to what people have to say” and doesn’t always “plough on regardless.”

At the time, Stephen Gilbert MP claimed there would be “dancing in streets from Land’s End to the Tamar” while Sheryll Murray said she was pleased that there was not going to be an “army of thermometer-wielding tax inspectors poking our pasties” worrying about the “vagaries of ambient temperature.”

But, in spite of the limited u-turn, the impact of the “Pasty Tax” is doing great harm.

Last week, the West Cornwall Pasty Company collapsed into administration. Much of the company – 34 of the existing 65 outlets – was bought out by a private equity fund, but 92 jobs have already been lost.

The previous owners blamed the introduction of the “Pasty Tax” for their financial problems, which they had to pay because they deliberately keep the food hot.

Although based in Buckinghamshire, the West Cornwall Pasty Company was set up by a Cornish family and, because of the protected status of the dish, all the firm’s pasties are made in Cornwall at Penryn.

It is unacceptable that Cornish jobs continue to be under threat because of the “Pasty Tax,” and Coalition MPs should be doing more to get it fully abolished.  

1 comment:

Pawl Dunbar said...

Sad news.

Another example of remote government destroying Cornwall's economy and Cornish jobs.