Subway franchisee loses appeal for 0% VAT rate
Supreme Court rules heated sandwiches fall outside the statutory definition of bread outlined in the VAT Act 1972
Print29 September 2020
An appeal by a Subway franchisee that the bread it sells should attract a zero VAT rate, has been rejected by the Supreme Court.
The case brought by Bookfinders Ltd, based in Tuam, Co. Galway also argued that as well as its heated sandwiches, its teas and coffees should also not be liable for VAT.
Under the VAT Act 1972, bread attracts a zero VAT rate. However, the court ruled that Subway’s heated sandwiches fall outside the statutory definition of bread outlined in this act, because the bread used has a sugar content of 10% of the weight of the floor included in the dough.
The Irish Times reports the appeal was brought by Bookfinders, following a 2006 decision by the Revenue Commissioners refusing the company a refund for VAT payments made between early 2004 and late 2005.
The five judge court also rejected claims that tea and coffee which was prepared hot fell under the 0% rate and that only cold tea and coffee, which had been heated, fell under the 13.5% rate.
The appeal was subsequently dismissed.
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