So the Pringle is a crisp after all. And not a cake, as the P&G's lawyers had argued (see p5). Quite right, too, I say. Pringles can be described as many things - a tasty snack, a clever gimmick, an early example of premiumisation, a party favourite - but Pringles are no more 'cakes' than Mr Kipling French Fancies are 'crisps'.
Or as Senator Joseph McCarthy said, "If it looks like a duck, quacks like a duck and walks like a duck, you're looking at a duck".
Obviously this won't make me popular with Procter & Gamble - and HM Government has no right to lecture companies on tax evasion right now - but for Pringles to escape VAT strikes me as wrong.
P&G argues it would pass on the savings to the customer, reducing the average cost of a £1.45 cylinder [The Grocer 33] by an average 19p at the current temporary VAT rating of 15%. But why should it get away VAT-free when it not only looks like a crisp, and tastes like a crisp (and may even quack like a crisp), but is every bit as high in fat, salt and sugar as a crisp? That's unfair not just on rival crisp manufacturers. It's unfair on smoothies and other healthy products that, for arcane reasons, are considered VATable.
Where I do have some sympathy with P&G is with the VAT laws themselves. It does seem ludicrous that potato crisps attract VAT, but corn tortillas do not; while nuts that have been shelled attract VAT, while nuts with their shells do not.
And it's also right to feel peeved about media coverage, with a number of national newspapers suggesting P&G will now be liable for a £100m tax bill. Since it started its appeal in October 2005, and throughout its expensive pursuit of a zero rating on Pringles, Procter & Gamble has continued to pay VAT and charge VAT. So there are no liabilities.
But challenging the law on the grounds that it is arcane is one thing. As MPs know, being morally right is very different.
Or as Senator Joseph McCarthy said, "If it looks like a duck, quacks like a duck and walks like a duck, you're looking at a duck".
Obviously this won't make me popular with Procter & Gamble - and HM Government has no right to lecture companies on tax evasion right now - but for Pringles to escape VAT strikes me as wrong.
P&G argues it would pass on the savings to the customer, reducing the average cost of a £1.45 cylinder [The Grocer 33] by an average 19p at the current temporary VAT rating of 15%. But why should it get away VAT-free when it not only looks like a crisp, and tastes like a crisp (and may even quack like a crisp), but is every bit as high in fat, salt and sugar as a crisp? That's unfair not just on rival crisp manufacturers. It's unfair on smoothies and other healthy products that, for arcane reasons, are considered VATable.
Where I do have some sympathy with P&G is with the VAT laws themselves. It does seem ludicrous that potato crisps attract VAT, but corn tortillas do not; while nuts that have been shelled attract VAT, while nuts with their shells do not.
And it's also right to feel peeved about media coverage, with a number of national newspapers suggesting P&G will now be liable for a £100m tax bill. Since it started its appeal in October 2005, and throughout its expensive pursuit of a zero rating on Pringles, Procter & Gamble has continued to pay VAT and charge VAT. So there are no liabilities.
But challenging the law on the grounds that it is arcane is one thing. As MPs know, being morally right is very different.
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