Dough! Osborne's embarrassing Greggs moment

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Chancellor George Osborne has come under fire for failing to remember the last time he bought a pasty from Greggs.

Appearing before a Commons Treasury Committee, in the wake of his proposals to close a VAT loophole on hot food to go, Osborne admitted to Labour MP John Mann “I can’t remember the last time I bought a pasty in Greggs”. Mann replied “That kind of sums it up”.

Greggs’ shares fell sharply last week after Osborne announced in the Budget that VAT would be added to hot takeaway foods sold by retailers. The move is expected to hit Greggs hard because a large chunk of its offering comprises of freshly baked products like pasties and sausage rolls.

Meanwhile, Greggs boss Ken McMeikan accused Osborne of having “lost touch” on BBC Newsnight.

“I think to a degree they have lost touch with the issue here - that for ordinary, hard-working families putting 20% on to a product that is freshly baked actually is going to make a severe dent in their pockets when they can ill afford it,” he said.

Readers' comments (1)

  • There appears to be a lot of misunderstanding and misinformation re the vat on hot food. The bottom line is anyone that sells hot food has had to account for vat for many years. This includes reheating pies, providing microwaves (as by doing so you are deemed to be intending to sell your pie hot even if the customer heats it in your microwave).Whilst many small businesses have had to vat account for hot pies, Greggs and indeed many supermarkets have got round this by selling freshly baked products (which just happen to be hot at the time you want to buy a hot pie) rather than selling hot pies. Subtle difference but one that Greggs and others have been able to exploit until now. It would have been better if all food heated (which involves a very limited service element) was zero rated but I guess the next best option is a level playing field.

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