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:confused: The 12-year legal battle

 

The Treasury could be forced to pay £3.5 million after a VAT error was made over Marks & Spencer teacakes.

 

HM Customs and Excise made the decision after the products were classified as chocolate biscuits.

 

The error has proven to be a costly one because chocolate biscuits are subject to standard-rate VAT and chocolate cakes are zero-rated.

 

The European Court of Justice agreed that a teacake is a biscuit and confirmed that the Treasury should reimburse the retailer.

 

Article here;

 

Treasury storm in a teacake - Yahoo! News UK

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This was the BBC's report

 

BBC NEWS | World | Europe | Teacake set to cost taxman £3.5m

 

 

Loved the Treasury's argument that if the Inland Revenue repay Marks and Spencer the VAT they have wrongly collected then M&S will be unjustly enriched.... if they don't then surely the Treasury has been unjustly enriched over the last 12 years... tricky one for the Lords :grin:

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