Food vat is ridiculous

[Kimbomc]

I'm just doing my bi monthly wholesale food shop (saves me a good 15-20% and these says spending 300 is easy). What annoys me is that lots of natural healthy food (like pure coconut water) has vat added where as lots of crap (biscuits and crisps) is vat free. Newspapers are vat free as essential, toilet paper has vat as its not essential.

Doesn't seem very fair.

No its not.

decent quality healthy food should be available to everyone.

I think even sanitary protection has VAT on it too.

Here's a widespread misconception that VAT is somehow a tax on 'luxury' (perhaps arising from luxury tax being abolished when UK joined EEC and had to adopt VAT).

If you want a luxury tax, then the only political party which supports it is UKIP.

VAT is an EU-wide tax on consumption, to which no new exemptions can be added. Governments can however tax more than the minimum, or keep some rates which were in force before their accession, which means rates can vary between countries (but only within those limits).

did you miss the whole point?!

It has half vat.

Crisps are subject to VAT. Some snacks however (tortilla chips for example) aren't.

YANBU though. VAT in general makes little sense with how it is applied.

Will not sure about the ukip vat, I do know its only "luxury" by name. Just seems crazy to have all this shit food vat free and healthier options have vat added.

VAT on foodstuffs (much of which is zero rated) is quite a complex area.

I think Chi Drinks Ltd v HMRC, FTT TC02512, 11 Jan 2013 is the most relevant case for coconut water.

Wow you are an expert on this!

Toffee apples, chocoly chip biscuits and Jaffa cakes are vat free. Nakd bars have vat this is just silly

But I don't think VAT on coconut water will; change any time soon. After all, VAT is also payable on bottled water.

"Will not sure about the ukip vat, I do know its only "luxury" by name"

I repeat. Despite misconceptions, VAT is not a 'luxury' tax, it's a tax on consumption.

UKIP want to abolish VAT (by leaving EU) and replace the general consumption tax with a luxury tax.

At present there is no luxury tax in UK.

There are plenty of zero-rated foods to allow for a healthy diet without paying any VAT.

Gingerbread man with two chocolate eyes has vat, three eyes is vat free

I get confused as well by how they work it out.

The one that really turns me into the hulk annoys me is sanitary protection... How is it non essential? It's no longer socially acceptable to walk around leaving a dug like trail of menatrual blood behind you so why should we be charged VAT on a non luxury item....
Then there's stamp duty.
Then there's inheritance tax

I sort of agree with you, the way vat is applied doesn't always make much sense. But coconut water is a luxury, we don't need it despite it being healthy, and it's not like we grow coconuts here in the UK so it seems normal that it would be more expensive.

It would be good if there were some kind of system where we. Old claim back vat on certain things. Like the full price trainers I had to buy for my ds last week because he needs them for school PE, which he has to do because the government says so, but cost a fortune because he's in adult sizes despite only being14.

Chocolate biscuits have VAT. Cakes don't.

The makers of Jaffa cakes feel strongly about this.

Well not sure I like ukips idea for food. I think food should have vat applied on if its healthy or not. No one needs Jaffa cakes or toffee apples.

Chocolate chip biscuits are vat free apparently.

YABU to say no one needs Jaffa Cakes... :p

I agree with osolea- VAT rules are seemingly unfair in places but we can't take VAT off of healthy products as was explained upthread. We could add it to ones that are not currently taxed though.

Nakd bars and coconut water aren't a necessary part of a healthy diet. I'm not even sure I'd call a nakd bar "healthy" in and of itself. Diets are healthy or unhealthy not individual foods. A nakd bar as an occasional treat instead of a mars bar- great. As a daily snack instead of an apple- pretty crap. In terms of VAT I think it's right that it falls into the mars bar category rather than the apple category. Perhaps cake should have vat though.

Here you go, official government guidance on VAT and food. It looks quite complicated.

www.gov.uk/government/publications/vat-notice-70114-food/vat-notice-70114-food

Crisps have VAT. Biscuits wholly or partially covered in chocolate have VAT. Gingerbread men decorated with chocolate are subject to VAT unless this amounts to no more than a couple of dots for eyes. Cake is VAT free. I don't really understand that one. It seems very odd to me that a giant chocolate cake is VAT free, but a bottle of mineral water isn't.

And yes, chocolate chip biscuits are VAT free as long as the chocolate chips are added before baking.

VAT being applied based on whether foods are "healthy" or not would be madness. Who would decide what is healthy? What makes a Nakd bar "better" than a toffee apple? A nakd bar has more calories and far more fat. It has less sugar. Is that what makes it healthier?

But then if you compare it to a bag of crisps it has more fat, more calories and more sugar. What makes it more healthy? The nice packaging, the fact that it's gluten free? The fact that it has fruit in it? (but that would make a toffee apple healthy too)

How would the law decide which foods are healthy or not? Fat content? Sugar content? Calories? Healthy looking packaging?

VAT being applied based on whether foods are "healthy" or not would be madness.

It would be less mad than the current rules.

Nakd is just dates cachews and a drop of natural flavouring.

But that isn't a system you can apply is it? What would the rules be for something to be classed as healthy? Low fat? Low sugar? High Fibre?

For the VAT rules to work there would need to be a rule that could be universally applied. It'd cost a fortune for every product to be individually assessed for "healthiness".

Any "healthy" rules would have odd exceptions. Some "healthy" foods are high fat, some are high sugar, some are low fibre.

Dates are very high in sugar, it's what makes sticky toffee pudding so decadent. They aren't by themselves healthy but can be part of a healthy diet... like most foods. Nobody needs a super-sweet nakd bar any more than they need a toffee apple. Both are fine as part of a healthy diet. I wouldn't eat either one every day. You could say the same about steak, sausages, chicken thighs, avocado, honey, pine nuts, peanuts etc. All fine in moderation as part of a healthy diet but if eaten excessively they are unhealthy.

VAT is a socially divisive tax anyway. It leeches money disproportionately from the less privileged and ought to be abolished imo.

VAT has evolved though, rather than being applied to everything (now) available in one go. So there will always be little quirks and things that seem odd when compared to another item.

So certain things (ie cake) might have been much more a staple/basic item than biscuits when the rules were first applied. People probably did not consume non-homemade biscuits at all back then. The ingredients to make most biscuits are likely to be Vat free.

As a PP said, VAT is a consumption tax. And as ilovesooty noted, far more is spent on Vat proportionally by the less well off than the rich.

Can't say I have a workable idea on what to replace it with though...and it would need to be replaced by another tax if abolished.

Certain printed matter is VAT free, which includes newspapers 'conveying a message by the printed word'. Toilet roll is not printed matter (you could use newspaper strips though if you want to go retro).

Packaged coconut water is not a necessity (and is rubbish for the environment); a fresh coconut is VAT free.

Bottled water is subject to VAT (and is terrible for the environment); water from the tap is VAT free.

VAT is an EU regulated tax. 25 countries have VAT on all foods, there is only the UK, Ireland and Malta with a zero rate. So that's almost half a billion people that think you are in a great position not paying VAT on some foods in the UK. See page 4:

EU VAT rates

The VAT system is far from perfect, but on this subject, the UK gets the best deal in the EU, so I think YABU.