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George Osborne's 'Pasty Tax' threat to Devon and Cornwall jobs

By Western Morning News  |  Posted: March 23, 2012

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Jobs are under threat in the Westcountry after a "pasty tax" emerged from George Osborne's Budget.

The Chancellor is considering slapping VAT on sales of the iconic dish, a cornerstone of Devon and Cornwall life, meaning the cost would rise by one-fifth, or add 50p to a £2.50 pasty.

There was anger across the region last night as pasty- makers, bakeries and politicians rounded on Mr Osborne's tax raid.

Hundreds of disgruntled pasty lovers signed an online petition and joined Facebook campaigns urging the Government not to press ahead with closing a tax "loophole". MPs told the Commons the move would undermine a sector worth £150 million to Cornwall alone.

Councillor Alex Folkes, deputy leader of the Lib Dem group on Cornwall Council, said: "This ill thought-out 'pasty tax' will cost Cornwall jobs. As well as being a cultural icon and great food, Cornwall's pasties are one of only a few successful manufacturing industries in Cornwall. At a time when the Chancellor should be doing all he can to save manufacturing jobs, this proposal risks many of them disappearing."

On Wednesday, Mr Osborne announced VAT at 20 per cent should be added to take-away hot food – including chicken rotisserie, sausage rolls and pies – sold at fast-food restaurants, bakeries and supermarkets.

A 50-page Treasury consultation document, posted quietly on the department's website, states that any food hotter than surrounding room temperature when handed over the till should be subject to the sales tax. The note mentions pasties by name, which the Chancellor did not in his Commons statement.

But the same selection of products – including the pasty – can be sold cold without VAT applying. Bakers yesterday called for the Chancellor to give the pasty the same status as baked bread, which is exempt from the tax grab.

Take-away pasties are a central feature of Westcountry holidays and staple meal for many workers stretching back to its origins in the tin-mining industry. The public consultation ends on May 4.

Mr Folkes added: "Adding 20 per cent to the cost of a pasty will hit sales and this will inevitably threaten jobs and the amount of money in the general Cornish economy.

"The Government has said that they are consulting on this proposal. I hope that they are genuinely going to listen to what people say and that they decide that a pasty tax is a bad idea."

Ann Muller, who makes award-winning pasties in her family shop on the Lizard peninsula, said the extra cost would mean either hiking the price of her top-crimped pasties or cutting back on staff.

She said: "We are a pie and pasty nation. It is very important for the working man, and it is they who will be hit by the tax. The pasty is a wholesome meal, and the Government should spend more time stopping the rich avoiding tax. But that's the Tories for you."

Mark Muncey, chairman of the Cornish Pasty Association, said he was "disappointed", but said some retailers already applied VAT.

"Local councillors have already expressed their concern about the impact this will have on the Cornish economy and we are equally concerned," he said. "We will be working with our members hoping to find ways to minimise the impact of any price increase to our consumers."

Councillor Andrew Long, deputy leader of Mebyon Kernow, said: "This tax could have a devastating impact on the pasty producers and retailers in Cornwall, and it would also hit the wallets of ordinary people throughout the Duchy."

Labour's sole councillor on Cornwall Council, Jude Robinson, said: "Will it be cream teas next? Are our MPs going to defend our pasty, our businesses and our exports from the Lib Dem-Tory coalition or are they going to do what they did over the 'Devonwall' boundary changes and the NHS?"

St Ives Lib Dem MP Andrew George vowed to fight the change in a Commons debate yesterday.

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  • Big_Ger  |  March 27 2012, 10:27AM

    I have, I have the plan to stop this tax!! The Stannary Parliament has, or so they tell us, the right to veto any Westminster law. If they veto this law, so that anyone who can claim; "I am Cornish as one of my parents is of direct indigenous Cornish descent or, I am Cornish by marriage, and that therefore, I consider myself to be an "heir and successor" of the Cornish Stannary Community who secured the Charter of Pardon from King Henry VII in 1508, confirmed as valid by the Lord Chancellor in 1977, which included the right to veto acts of the Monarchy, the Westminster Parliament and the Duchy of Cornwall," does not pay the "Pasty Tax", then they are on a winner. It would be an immense boost for Cornish nationalism, the Stannary parliament would be lauded long and loud in the streets of Cornwall, and all us Cornish folk would be 50p up on our pasty. They cannot lose, what's stopping them?

    |   -7
  • JeremyBadger  |  March 26 2012, 2:45PM

    Ann Muller said the extra cost would mean either hiking the price of her top-crimped pasties................I understood that, according to the Cornish Pasty Association, to be "A genuine Cornish pasty has a distinctive 'D' shape and is crimped on one side, never on top." crimping on the top was specifically outlawed in PGI.A Protected Geographical Indication (PGI) is one of three European designations created to protect regional foods that have a specific quality, reputation or other characteristics attributable to that area. How does Ann Muller reconcile her pasties with the PGI?

    |   -8
  • o0Dj0o  |  March 26 2012, 1:58PM

    by JAM1989 Monday, March 26 2012, 1:33PM "for god sake its not PASTY TAX. Its VAT. I wish they wouldn't write incorrect and misleading news for idiots to believe." Well said!!! Anyone who has the smallest bit of intelligence would know you can't Put tax on culture hence the cornish pasty! so its not a tax on pasties made in Cornwall but meirly a Vat increase for the product as a whole not for where its made. personally id be worrying about the raise in fuel cost rather then a vat rise on a food product. bassically build a bridge and get over it................................ or f*** off back to cornwall.

    |   -2
  • Stuboy13  |  March 26 2012, 1:48PM

    "Does anyone else think Pasties smell of B.O?"

    |   -13
  • JAM1989  |  March 26 2012, 1:33PM

    for god sake its not PASTY TAX. Its VAT. I wish they wouldn't write incorrect and misleading news for idiots to believe.

    |   6
  • Big_Ger  |  March 25 2012, 9:44PM

    Is there anything that his party is party to that Andrew George agrees with any more?

    |   -5
  • DuporthBob  |  March 25 2012, 9:22PM

    Fat tax!

    |   3
  • sweeney2010  |  March 25 2012, 8:27PM

    I foresee a rash of mircrowaves on the customer side of the counter.

    |   3
  • plymisgreat  |  March 25 2012, 7:37PM

    It's not really a "pasty tax", its a tax on all fast food. I'm surprised it's been exempt to be honest and I can't see how this is going to make a huge difference to the local economy. People who are spending £2.50 will still spend £3.

    |   2
  • Eddie_PZ  |  March 25 2012, 6:56PM

    I feel reassured to know that Andrew Gorge is going to fight this one to the last crumb. I was walking down Market Juice Street back in the 1980, in those days when you had tourists and open top buses in the town, when some emmet flung a pasty from the top of the bus. It hit me on the back of the neck and put me off pasties for ever.

    |   3