Cornwall’s pastymakers are the county’s largest manufacturing cluster, turning over around £300 million collectively each year. It’s no surprise then that when the government announced the introduction of VAT on all hot takeaway food – intended apparently to be aimed at supermarkets selling hot chicken but incorporating, apparently unintentionally (depending on who you speak to), hot pasties - Cornwall’s pastymakers were up in arms.
The story
The Cornish Pasty Association (CPA) is the representative body for the county’s pastymakers and this was a moment for them to spring into action – and spring into action they did, attending meetings with ministers and joining forces with other organisations nationally to put up a united front. Cornwall Food & Drink acts as the admin body for the CPA and we sprang into action too.
Headlines in the papers often belie the amount of hard graft going on below the surface. For the government to change their minds on what became known as the Pasty Tax, they needed more than a front page tabloid story; they needed a proper case to be made and they needed that case to be supported with evidence.
Using data she’d put together previously for the CPA, along with the mass of intelligence she’d gleaned through years of analysis of Cornwall’s food sector, Cornwall Food & Drink’s Ruth Huxley therefore prepared the case. Detailing the potential impact of the proposed tax on Cornwall’s pastymakers, the direct and indirect value of the pasty industry to Cornwall, and the reasons why the government’s proposals were flawed, this was the case submitted to the government by the CPA and also formed the basis of Cornwall Food & Drink’s own submission.
Contrary to popular opinion – led by more tabloid headlines - the government didn’t capitulate and there was no U-turn and no victory, but there was definitely a compromise. The result meant that all the pastymakers who bake on their own premises and serve their pasties straight from the oven, or simply leave them to cool naturally, continue to be exempt from VAT. In particular this has helped the very small bakers who don’t use heated cabinets to keep their pasties warm.
The battle isn’t over, and the impact of the Pasty Tax on some of Cornwall’s bakers has been significant. We will continue to make this clear and to press for a better solution. In particular, one of the issues the Pasty Tax served to highlight is just how much of a burden the 20% VAT rate is on the food and hospitality sector as a whole, where margins are already tighter than virtually any other industry. We feel a special case is warranted and will lobby for change.
"The Pasty Tax presented the CPA with an enormous challenge and we were thankful to be able to draw on the support and wisdom of Ruth Huxley and Cornwall Food & Drink, whose industry intelligence, report writing and management service we have come to rely on. They do a superb job for us.”
Mark Muncey, Chair of the CPA at the time of the Pasty Tax and Marketing Director, Proper Cornish
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