George Osborne MP, the Chancellor of the Exchequer in the UK, recently announced that on October 1st 2012 VAT will be added to ‘sports nutrition’ products, effectively increasing prices for these supplements by 20%.
During his recent budget statement, Osborne stated “we will also address loopholes and anomalies in VAT on food and drink”. Currently in the UK, soft drinks and sports drinks have VAT added to them while sports nutrition drinks do not. However, many would argue that these supplements are often used as meal replacements, which would suggest Osborne is not ‘levelling the playing field’ quite as much as he may think he is.
Now, a campaign against the VAT hike has begun and is gathering speed…
Several companies and well-known members of the fitness community have already started to campaign against this move, with everything from an online petition against adding VAT to sports nutrition drinks through to summit meetings and template letters that individuals can send to their local MPs.
BulkPowders, for example, have stated the following in a recent email to worried customers:
BulkPowders, alongside several other companies, has recently formed the UK Specialist Sports Nutrition Alliance. The Alliance will be campaigning against the proposed 20% VAT on all sports nutrition products.
On the 29th March 2012, BulkPowders attended a meeting with a number of other leading UK sports nutrition companies. The outcome is that, together, we will campaign against the proposed addition of 20% VAT on sports nutrition. BulkPowders will be contributing both finance and resource behind the campaign to try and prevent VAT being added to your products. We feel this is an issue that is extremely important to our consumers. Many of our loyal customers are frequent users of whey protein (and other products) and a 20% increase in price would have a discernible impact on their monthly supplement expenditure.
Worse still, it appears that Osborne may well have acted against the Government’s own guidelines on bringing in these changes. The consultation period for the VAT increase on sports nutrition drinks was six weeks, whereas the guidelines say this should take twelve weeks. Equally, many who oppose the ruling have noted that a 20% increase in prices is not a ‘small increase’ as described by the Government, and that this alone shows the Treasury to be out of touch with reality and the hardship being felt by many during the current economic conditions.
“Taxing those who are trying to improve their health while spending millions on accommodating obese hospital patients; ludicrous”.
In a year when the UK are to host the Olympic Games, is the VAT hike on sports nutrition drinks really the right message for the Government to be sending out? Let us know in the comments below…