Pasty-Gate: Sensible Tax Increase or Class Warfare?

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April 4, 2012 by Nash Riggins

It shouldn’t surprise anyone to know that Britain is run almost exclusively by a group of very well-off white men – after all, it’s common knowledge that the majority of party leaders learned Greek in an exclusive prep school before buying at least one degree from Cambridge or Oxford. Is this an unfair stereotype? Perhaps. Yet when unpopular legislation is put forward, it is this stereotype that inevitably becomes the scape-goat for virtually every issue in British politics regarding class, and in many cases it’s completely unwarranted.

Take last week: when George Osborne unveiled Westminster’s annual budget to the public, he made several bold concessions and legislative decisions that went effectively unnoticed. Meanwhile, one minor bullet point, the hot food tax, unintentionally instigated what the media have falsely labelled as an act of ‘class-warfare’ by the government against Britain’s working-class.

The controversial VAT increase of 2011 meant a hike in the prices of products all across the board, from cars and motorcycles to toiletry items – yet for whatever reason, a select few businesses were exempt from the hike. For example, while fast-food restaurants such as McDonald’s were subject to a rise in VAT of up to 20%, bakers and pastry outlets such as Greggs were completely exempt from the tax-hike.

One could argue that this move may have been a precaution in order to foster a local industry’s fight against an international conglomerate, were it not for the fact that virtually every other local enterprise in the UK, including chip shops, were subject to the VAT increase – so why were bakers like Greggs exempt in the first place?

This trivial tax loophole began in the 1980s, when former Chancellor Nigel Lawson decided to instigate a VAT charge on hot food in the UK, with an exemption from the tax for all freshly-baked products. Yet in an effort to avoid the double-dip recession that is afflicting much of the Euro Zone, Mr Osborne has decided that this 30-year-old tax exemption was a corner that should be cut; indeed, the 20% VAT is projected to raise around £120m annually once it has been fully activated. To Mr Osborne, this must have appeared to be a fairly straight-forward decision – yet to the media, quite unsurprisingly, the tax increase looked more like an all-out attack against Britain’s working class.

According to the Sun, “slapping VAT on hot takeaway food is not a trivial issue, much as it may seem like it for rich men in Westminster. It is a kick in the teeth for hard-up working people. And a potential disaster for those whose jobs may live or die on it. Like the 13,000 in Cornwall’s pasty trade.”

David Cameron immediately jumped into the deep-end in order to save Mr Osborne, arguing that the exemption was an unfair loophole, and that charging VAT on pasties will even the playing field within the food industry. His defense appeared extensive and warranted, until he began to reminisce about his last pasty – unbeknownst to him, at a middle-class bakery that had been closed for nearly five years. Naturally, the media gleefully used Cameron’s gaffe in order to illustrate just how out of touch he really is with Britain’s working class. To top it all off, Ed Miliband decided that this would be an opportune moment to show regulars at Greggs just how ‘in-touch’ he is.

“The Government is now putting 20 per cent on the cost of pasties, sausage rolls, and the Chancellor’s excuse? Well, he says you can buy them cold and you can avoid the tax,” Mr Miliband said during his sausage-roll photo-op. “It just shows how out of touch this Government is and it shows that we’ve got a Budget that is hitting millions of people while cutting taxes for millionaires.”

Millionaire Ed Miliband is absolutely right! The government should tax him substantially more. As for his assumption that the government is out of touch with its working-class, we should probably just take his word for it – after all, he’s the one with degrees from Oxford and the London School of Economics.

Half of Westminster is completely out of touch with the public, but let’s be honest: most uneducated or apathetic voters probably only selected their MP in the first place simply because he or she ‘looked smarter.’ Indeed, newspapers should stop pretending that Westminster has only recently been invaded by elitists whom those very same publications endorsed in by-elections not six months ago. David Cameron, Ed Miliband and George Osborne each made more money from personal appearances in 2011 than most of us will ever make in our lifetimes – but that does not magically transform every legislative decision that the government makes into an act of class-warfare.

This new VAT-increase on hot foods, which the media is quite irritatingly referring to as ‘Pasty-Gate,’ should have been a no-brainer; after all, chip shops have been paying VAT for 30 years, why the hell shouldn’t Greggs? If people can’t find the extra 15-20p they’ll now need for their morning fix of greasy pies, perhaps they should switch to a healthier and cheaper alternative (ie whole-grain cereal). Times are tough, and somebody has to take one for the team – in this case, ideally a group of companies that haven’t been paying the same amount of taxes as the rest of us do. In the meantime, however, the media and politicians should do us all a favor and stop making mountains out of mole-hills.

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