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Bakery Products: VAT

Question for Treasury

UIN 78634, tabled on 22 July 2020

To ask the Chancellor of the Exchequer, what plans he has to change the rate of VAT applied to pasties baked for sale by retailers where there is no intention that they be consumed hot, they are not cooked to order, are not kept hot after cooking, are advertised merely as freshly baked, and are provided to customers in a simple standard paper bag.

Answered on

7 September 2020

VAT raised £130 billion in 2019-20 and is an important source of revenue for the Exchequer, funding the Government's spending priorities including hospitals, schools, and defence.

VAT is levied on supplies of hot takeaway food. “Hot food” is food that is supplied and intended to be eaten when hot (above ambient air temperature). However, some takeaway food may be zero rated if it is not intended to be eaten hot and is sold warm simply because it happens to be freshly baked and is in the process of cooling down. Therefore, freshly baked takeaway pasties that are not intended to be eaten hot are zero rated.

While all taxes are kept under review, there are currently no plans to change the rate of VAT applied to pasties.

Answered by

Treasury