Friday, 18 May 2012

Discussing pasty tax with Nick Clegg

This morning, during his visit to Cornwall, together with Mark Muncey of the Cornish Pasty Association and Steve Gilbert MP, I had a discussion with Nick Clegg about the pasty tax.

We explained the threat to Cornish businesses of the proposed tax including the likely loss of up to 1100 jobs in the pasty industry itself and the wider supply chain as well as more than £35 million from the Cornish economy.

We also explained that the current proposal is unworkable and would lead to huge confusion. This wasn't a plea just for the pasty industry, but for bakers across the country who produce different types of savouries.

Nick was very open to the arguments that we made and receptive to the ideas being put forward. It was a constructive meeting which I hope will lead to a rethink of the proposals in government. There is no doubt that the current VAT rules are a bit of a mess with a disparity between fish and chips on the one hand and supermarket rotisserie chickens on the other. In the middle of all this, local bakeries have been caught and look set to lose either way. There is clearly an option to add VAT to any product which is kept hot and to exempt those which are simply hot as they have come out of the oven but are cooling.

The formal consultation on the proposed changes ended today and I hope that there will be a positive announcement in the near future. I think our discussion today was a positive contribution.

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