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Immortality through Jaffa Cakes and VAT
There are many people who have achieved immortality of a sort through their involvement in tax cases. One thinks of Mr Rutledge – he of the million toilet rolls which may or not actually have existed (Rutledge v CIR 14 TC 490) – or Anne Mallalieu (still with us), whose dislike of having to wear black clothing was discussed in a seminal House of Lords’ judgment (Mallalieu v Drummond [1983] STC 665). Readers will, I am sure, have their own favourite examples.
These thoughts were prompted by an obituary which appeared in The Times last week of John Brown. The name may not mean much to many readers but as soon as I mention Jaffa Cakes you will know what I am talking about. Mr Brown was a leading figure in the VAT practice at Ernst & Young and was the adviser to United Biscuits, who manufactured the aforementioned cakes. But were they actually cakes? That was the question. If they were cakes, they would be zero rated but if they were chocolate biscuits, they would be standard rated. Famously, an extra-large Jaffa Cake was produced at the VAT tribunal as evidence and it was also shown that Jaffa Cakes, like other cakes, go stale and hard when left in the open air whereas biscuits go soft. As every student knows, the tribunal held that they were cakes and Mr Brown had a famous victory, which he celebrated for the rest of his life and, indeed, beyond. I love the story that Jaffa Cakes were handed out after his funeral.
The tribunal case report is brief and gives virtually no detail about what actually happened in the case. Is it possible that some myths have grown up about the case? I hope not, but I’d love to hear from any readers who were there and knew exactly what happened.
If you do one thing...
See the updates to the Economic Crime Supervision Handbook relating to trust or company service providers (tinyurl.com/ecshupdates).
