The European Court of Justice is to put an end to a 10-year row into whether Marks and Spencer should receive a VAT rebate for its chocolate-covered teacakes.
In 1995 M&S claimed that between April 1973 and October 1994 it had wrongly accounted for VAT on sales of its chocolate-covered teacakes after Customs and Excise said that the cakes were biscuits and should be charged VAT.
However, Customs and Excise then ruled that the biscuits were actually cakes and therefore did not attract VAT.
The European Court of Justice will now decide whether the retailer is entitled to a £3.5m tax rebate.
In 1995 M&S claimed that between April 1973 and October 1994 it had wrongly accounted for VAT on sales of its chocolate-covered teacakes after Customs and Excise said that the cakes were biscuits and should be charged VAT.
However, Customs and Excise then ruled that the biscuits were actually cakes and therefore did not attract VAT.
The European Court of Justice will now decide whether the retailer is entitled to a £3.5m tax rebate.
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