The part of George Osborne’s budget that still seems to be causing a political stir is that of the adding VAT to ‘hot’ food sold in retail outlets. VAT previously wasn’t added to ‘hot’ food from retail outlets such as Greggs, however the Chancellor announced that no longer would the pasty loving British be able to shy away from adding to the public purse. The backlash and ridiculous pictures of Labour leaders eating pasties has covered the newspapers. It seems the that Osborne’s attempt to reduce grey areas in tax, have instead added new ones;‘What temperature is my pasty hot enough that is then is subject to VAT?’..’If I say that I will eat the pasty at home is it exempt?’ as so on. It is the epitome of Britishness.
Though there is a bigger picture for the UK consumer than the heat of pasties, inflation is increasing and earnings are not. The consumer has less disposal income available, as their earnings have flat lined and outgoings have increased. Fuel prices have increased substantially which are a pain the majority of families feel, be it to run a car or a household. With less disposal income, there is less spare money to spend on the high street perpetuating the issue of growth in the UK. As testament to this it was announced yesterday that the UK contracted more than expected and is expected to enter its fourth consecutive year of negative growth.
As the first time buyers stamp duty holiday is about to come to an end, it was announced today the mortgage approvals came in lower than expected just shy of 49,000. With the housing market stuttering, a drought in the South East, the high street suffering and the Oil tanker drivers about to strike, the British are in uproar over their hot food from retail outlets. On twitter is has been given the hash tag of #pastygate.