Vat On Sugar Malt Dextrose Grain Etc

itsmefolks | 11:38 Fri 18th Jan 2013 | Business & Finance

5 Answers

We retail in sugar, malt extract ,barley, wheat etc. In general we supply to the home wine and beer makers. My question is why do we get charged vat on these goods when it is classed as food??

Regards and thanks for any help.

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woofgang

ermmm because HMIT have decided that they are vat chargeable?

Ellipsis

Generally VAT is applied to "luxury items". Alcohol is classed as a luxury item, therefore it seems logical that home brewing and winemaking products would also be luxury items.

See section 3.7.4 of this document - HMRC have clearly put some thought/experience into this:

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ShowContent&id=HMCE_CL_000118&propertyType=document

heathfield

Read about it...

http://www.hmrc.gov.uk/manuals/vfoodmanual/vfood9000.htm

itsmefolks

Question Author

Just seems wrong that the vat is placed on sugar to make beer with, and not on sugar to make a cake!! We dont sell alcohol, just the ingredients to make it! Grain is used to make bread but that is not taxed. Cheers.