Thursday 2 August 2007

VAT

It has been added to my bank of fascinating and useless knowledge that cake is not VAT-able.

One of the Fiscal Officers down the corridor has been to visit this morning (yet another problem with past record-keeping and billing procedures in this office -- I should also mention that 'the dead guy' died one year ago yesterday, so there was kind of a pall over part of the office yesterday. The certain people have been talking about it for a week now... I kind of stayed quiet-ish, and that is not an easy feat.). This Fiscal Officer is hysterical, in an accountant sort of way, and used to work for Sainsbury's. He regaled us with tales of being a financial lackey for the grocery industry in London.

VAT means 'Value Added Tax' and is automatically added onto certain items you buy. This is VERY handy when you are shopping here because the price you see is the price you pay. None of this trying to do multiplication by 8.25% to figure out if you will be impoverished by this purchase; you are simply able to ascertain that it will from the label! Hoorah.

Well, it turns out that cake is NOT a VAT-able item, as it has been deemed a necessary survival purchase. This idea receives my approval; and Sally's; and Clare's; and Suzy's.

Biscuits (aka, cookies) are also not VAT-able, as long as they do not have chocolate on them, as this is considered a luxury purchase. This is preposterous and a travesty of Tax Codes in civilised society. Chocolate is most certainly necessary for survival, although primarily of those in near proximity to the consumer.

A loophole has been made by Jaffa Cakes, which are chocolate cookie-type things with orange jam inside. They call themselves 'cakes' so as to avoid VAT. Clever little Jaffa monkeys!

And, now we have had our little lesson on tax.

I think someone needs cake...

2 comments:

Mimi Rankin Webb said...

so, can jaffa cakes co. be sued by the barrister's for vat/tax evasion if one proves that they are in fact a chocolate covered biscuit/cookie & in fact not a true cake? & do cake-mix-made products also get a reprieve for same said reason?
just curious!!!!!!

Matthew said...

Ahhh the old debate of what makes a cake a cake and a biscuit a biscuit. Believe it or not there was an EU committee looking into this issue for the very same Jaffa Cakes.
Ruling is dependent on what happens to it when it goes off.
Biscuits=soft
Cake=hard
QED