Pasty makers bring their VAT beef to Downing Street

Hundreds of bakery staff from all over the country gathered outside Downing Street to draw attention to the proposal to change VAT rules to include hot foods, including pies, pasties and sausage rolls.

The government wants to amend current rules to bring bakeries and supermarkets selling hot food into line with takeaway business, which are already charged 20 per cent VAT for selling similar products.

But the bakery industry says the levy is unreasonable, complex and would force many independent businesses to close.

Led by the National Association of Master Bakers and Greggs bakery chain, they have already collected around 500,000 signatures for the 21 boxes of petition pages they handed in to No 10 today.

But they are keen to gather still more before the 4 May consultation deadline to try to force Chancellor George Osborne to drop the plans, which are due to take effect in October.

And they are deadly serious.

Ken McKeikan, chief executive of Greggs, declared through a loudhailer: “The gravity of the situation that faces our industry must not and cannot be underestimated.

“For generations these bakers have strived to create a bakery industry that is loved by customers for the bakers’ skills, affordability and delicious produce. We have to say no to higher prices.”

Nowhere is the full force of a pasty tax likely to be felt more acutely than in Cornwall, where pasty makers are obliged to use high-quality ingredients to meet strict rules of Protected Geographical Interest (PGI) status.

Gavin Williams, who runs West Cornwall Pasty Company, said: “Providers of other food would be able to look at sourcing cheaper ingredients from alternative sources in order to absorb some of the increase, but that is not an option for suppliers of traditional Cornish pasties.”

Among the supporters at the protest was St Austell and Newquay MP Stephen Gilbert, who led the delegation to Downing Street and helped dish out some of his constituents’ wares to garner public support.

He said: “It is simply wrong for the government to impose a tax on the humble Cornish pasty while luxurious caviar remains tax-free. If these plans go ahead, it could result in 400 job cuts and losses to the Cornish economy of £7.5m.”

The Treasury says the pasty tax would close loopholes, address anomalies and “ensure a level playing field”.

Mr Williams believes it would run counter to the government’s growth strategy.

“It seems ironic that in these economic times the government are not only throwing obstacles in that path, but also risking many existing jobs in the process.”