Jaffagate

If you watched the Great British Bake Off (GBBO) this week, you will know that GBBO re-opened the most British of debates about whether Jaffa Cakes are a cake or a biscuit.

As GBBO had introduced the Jaffa Cake challenge in their ‘Cake’ week, debates and no-doubt full blown arguments started in living rooms across the nation and the British public took to twitter in full force to try to settle this debate once and for all.

‘We don’t do that in the South you know’

This was Mary Berry’s reaction to paul dunking his Jaffa Cake in his cup of tea,  and the polarising views on twitter continued…

 

Even HMRC took sides

Albeit back in 1991, this question even caused a fierce debate between HMRC, who took to the view that Jaffa Cakes were biscuits for VAT purposes and McVitie’s, the makers of Jaffa Cakes, who disagreed.  In the UK, cakes covered in chocolate are zero-rated for VAT but chocolate covered biscuits are subject to the standard rate. The debate was taken to the courts and culminated in a tax tribunal where after much deliberation, I’m sure accompanied by many cups of tea and Jaffa Cakes, the court ruled in favour of McVitie’s that Jaffa Cakes are indeed cakes (at least for VAT purposes).

HMRC do have many strange VAT rules when it comes to food:

  • Nuts in shells, zero-rated. Shelled, roasted and salted nuts, standard rate.
  • Potato crisps, standard rate. Maize and corn snacks (e.g tortilla chips), zero-rated.
  • Frozen foods, zero-rated. Ice-cream and frozen yoghurt, standard-rate.

I for one would like to be a fly on the wall in these discussions.

In the spirit of this light-hearted blog post this week, we at Bright Horizon hope you have a wonderful (and hopefully hot and sunny) bank holiday weekend!

 

Jody Miles
Qualified Chartered Management Accountant with more than 10 years practice experience. Very different from the stereotypical accountant but professional and diligent none the less. In my spare time I enjoy spending time with my young family and volunteering on the Calshot RNLI Lifeboat.

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