Just in case any of you were beginning to think that taxation is a dull and boring subject, please be reassured that us practitioners maintain our sense of humour particularly when we hear about some of the amusing tax cases that quite unbelievably, find themselves enter the courts. The famous case involving whether a tea cake was a cake or a biscuit involving Marks and Spencer and the VAT authorities springs to mind. In that instance, chocolate teacakes were wrongly classed as a biscuit for two decades ruled the European Court of Justice.
The latest of these cases to find its way to London’s High Court involved a judge having to decide whether or not Pringles are or are not a potato crisp in the eyes of the law. The significance of this ruling was that the snack would remain free from VAT if it could be found that they were not a crisp and thus save its manufacturer Proctor and Gamble millions of pounds on UK sales.
Under UK law, most food is exempt from VAT except for potato crisps and similar potato products.
No doubt much merriment was experienced in Court as highly paid barristers argued the differences between a Pringle and a crisp and presumably various taste tests were undertaken. Perhaps expert witnesses from Masterchef may have been called – who knows.
Anyway, the result – I know you are all waiting with bated breath- was that the judge in his wisdom has ruled that Pringles are not potato crisps in the eyes of the law. Thank god I hear you all saying reaching for a crisp or was that a Pringle.
However, I can’t let this tasty morsel lie here. I just can’t stop wondering about the costs involved in such a matter going to Court. The legal costs alone on both sides must have run to hundreds of thousands of pounds. Even more worrying is the fact that this comes after a VAT tribunal had previously ruled that the snack was subject to VAT.