The Irish courts have ruled that Subway sandwiches cannot be called ‘bread’ over an issue which involves a lot of money for one Subway franchisee.
A Subway franchisee called Bookfinders Ltd had tried to argue that it shouldn’t have to pay VAT because it sells “staple” products, which have a 0% VAT rate in Ireland.
But according to thejournal.ie, the Irish Supreme Court ruled that Subway ‘bread’ contains too much sugar to technically be called bread.
According to Irish law, for bread to be a “staple product” and not therefore pay VAT, the sugar content “shall not exceed 2% of the weight of flour included in the dough”. Subway’s bread has a 10% ratio.
Bookfinders Ltd had submitted a claim to the taxman in December 2006 where the company argued for a refund