Fresh fruit smoothie manufacturer Innocent is calling on the government to help the population meet the 5 A DAY target by cutting VAT on fresh fruit drinks.
The Innocent campaign team say the government should “remove the discrimination inherent in VAT rules against smoothies and pure fruit juices” to help stimulate uptake.
“If the government is serious about our health and about fruit and vegetable consumption, in particular, it needs to get tough on anarchic and ridiculous tax laws,” said Jamie Mitchell, Innocent marketing director. “…A simple change in the rules could massively improve UK fruit consumption and have a real and material impact on the health of our nation.”
Mitchell argues that by removing VAT on smoothies and similarly pure juices, the government could increase sales by 15 per cent. “That’s equivalent to an additional half billion portions of fruit consumption a year.”
The Treasury cannot put a zero-VAT rating on smoothies or fruit juices unilaterally according to EU regulations, but it could reduce the rating to just five per cent, the manufacturer argues, and this alone would have a significant impact on consumption. “The chancellor only recently reduced taxation on condoms to five per cent so the government must believe it can be effective as an incentive to consumers to change behaviour.”
The Treasury’s response so far has been guarded. “All taxes are kept under review,” a spokesperson said, adding that reduced rates of VAT only applied where the tax system could support social objectives that could not be targeted in other ways.
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