One of the North East's biggest and successful firms in celebrating victory in the row over the 'pasty tax'.
Gregg's today welcomed a government climb down on proposals that would have seen 20% VAT applied to hot baked snacks such as pies and sausage rolls. In the two months since it was announced in the Budget, the company has argued the food it sells isn't really hot.
Today, after winning the argument, its share price, which has suffered in recent weeks, jumped by 8%.
How the new tax will work
- Food advertised as 'Hot' or cooked to order, such as toasted sandwiches, will be taxed at 20%
- Anything cooked then kept warm, under hot lamps or special packaging, will also attract VAT
- Baked goods that are cooked then left to cool naturally will remain VAT-free, no matter what temperature they're served at
But Labour has criticised the u-turn, describing the government as a "shambles".
There was also a change to plans to introduce 20% VAT on static caravans. The rate will now be 5%. Caravan park operators, who feared the tax would cripple an already struggling industry, have given a cautious welcome to the news.