Food zero rating

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There is a long series of Tax Tribunal cases addressing VAT zero rating for food. Decisions generally turn on the specific facts.

I understand the zero rate Group 1 is based on post-wat, pre-VAT legislation, designed to encourage healthy eating. With constant development of new products, the definitions in Group 1 are frequently found deficient and unhelpful. This therefore generates frequent litigation.

It is time HMRC and the Treasury re-wrote Group 1 and simplified it. If necessary, include reference to healthy or unhealthy foods, and apply a higher rate to unhealthy foods. This will also mean we need no new taxes on soft drinks, chocolate or anything else!

I would offer to assist, on condition that I get to taste the less healthy foods.

The most recent case concerns the zero rating of Juice Cleanse Programmes.  The HMRC advocate earned herself some criticism for basing her argument in part on food labelling regulations, which the Tribunal found ‘particularly unhelpful.’ She also sought to introduce new evidence on the day before the Hearing, sending documents to the taxpayer’s Counsel at 4pm on the Sunday afternoon (the Hearing started on Monday 3rd December). The Tribunal, agreeing with the taxpayer’s Counsel, indicated that such practice constituted ‘litigation by ambush!’


About Les Howard


Hi, I am a VAT Consultant, working mainly with charities. I am based in Cambridgeshire

I have over 20 years experience in VAT, and am currently also a part-time member of the Tax Tribunals.


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