(4) Crisps, nuts, and prawn crackers in sealed packets Next time you’re struggling to decide between Walkers and Doritos with your lunchtime meal deal, consider this: only one choice will provide the tax man with a significant boost. While potato crisps, potato sticks, potato puffs, and similar products made from any combination of potato starch or flour and cereal flour are deemed a luxury by HMRC, tortilla and corn chips get off scot-free with a zero per cent rating. And the deeper one ventures into the savory snack minefield, the more complicated it gets. While prawn crackers made from tapioca are zero-rated for VAT purposes, those made out of cereals are treated as standard-rated luxury items – unless, of course, they’re part of a takeway and don’t come in a sealed bag. Flavoured rice cakes are subject to VAT at the normal rate – while those “intended for consumption with cheese or other toppings” aren’t subject to a levy. And popcorn is standard rated, unless it’s microwave popcorn, in which case you’re in luck and its tax-free. If you were hoping nuts might be more straightforward, think again. Nuts in shells are zero-rated, unless they’re salted – while roasted ones are standard-rated, unless they’re almonds. Bombay mix throws yet another spanner into the works, because it usually contains a mix of both luxury and essential items. As long as the proportion of standard-rated ingredients by weight doesn’t exceed 25 per cent, the whole thing can be sold without VAT payable. But if the mix is too heavy on roasted nuts, the matter gets a lot more complicated – and some unlucky graduate will find themselves tasked with measuring the exact proportion and adjusting the tax accordingly. The guidelines strongly suggest the possibility that the Institute for Fiscal Studies’ director Paul Johnson has taken a trip down a savoury snacks aisle before denouncing the UK tax system as “absurd” in May 2014. We’ve saved the best for last on the next page. With a scandal involving two Conservative politicians and a Cornish nationalist, can you guess which snack was involved?
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