The eat-in tax: is it causing us to use more disposable products than we need to?

You've probably experienced this in most fast-food places and coffee shops - two prices for the same product, one for eat-in and another for takeaway. The eat-in option is always more expensive, sometimes by a third of the total cost of the product! This is colloquially referred to as the 'eat-in' tax or the 'pasty tax', as it's known in the UK.

We've come up against this in plenty of places and have witnessed people who actually end up eating in the restaurant/fast-food joint, but specifically ask for takeaway when the cashier is taking their order. Because why should people pay an addition £1.50 for an already over-priced lunch?

But what happens when people try to save a little of their hard-earned cash? Our meals end up packaged up in even more disposable paper bags, napkins and plastic cutlery. All a huge waste since it's disposed of the moment someone sits down to eat-in.

So the question arises - are we contributing to mass environmental destruction by making takeaway food cheaper?

We would definitely argue so. But first, let's discuss why restaurants charge more for eating-in in the first place. Well, it all comes down to Value-Added tax (VAT). The way food is taxed depends on 3 key factors: the food categorization (whether it's ready to eat or needs to be cooked), the temperature of the food (whether it's bought hot or cold) and the environment (whether it's takeaway or eat-in). So to illustrate, here's a great example of how VAT is charged on food.

If you are running a take away business and you would like to serve hot food or if you are a restaurant and you would like to serve cold food you will have to charge VAT. If you are a take away business and you want to serve cold food you do not need to charge VAT (unless the product attracts VAT in itself) but if you are a restaurant you must charge VAT on cold food.

In a nutshell restaurants must always charge VAT on everything except food that is cold and taken away, takeaway vendors do not need to charge VAT unless the food is hot and/or the customer would like to eat in perhaps a designated sitting area. 

We've looked around the web to see if there are any studies which could provide an estimate of how much waste we could prevent from ending up in landfills if only this eat-in tax didn't exist, but we've had no luck, much to our surprise. So sadly, we don't have any interesting facts to share about how much waste we could prevent if the eat-in tax was abolished, but we can imagine it's a lot.

Having the same price for eat-in or take-away (even if that means that the take-away price actually includes the VAT!) would encourage many more people to choose the eat-in option. It's basic human behaviour: if you see two different prices for the same thing, you'll want to choose the cheaper price and take the extra packaging with you. If you see only one price, you'll be a lot more encouraged to actually tell the cashier you want to "eat-in" when they ask. Obviously then prices would go up as you wouldn't have an option for cheaper takeaway. But can you really put a price on our environment?

So should we call a petition to change the way food is taxed in the UK (and Europe)? On first thought, we think so - but this is purely based from our own experiences. We haven't seen any research which indicates that this is in fact a big issue, but perhaps it's just not an issue many people have thought about yet. Yet we think it's definitely worth asking the question and being aware of this. Perhaps governments or independent bodies will be encouraged to do some research. We'll probably find that we should make changes, for the greater good of our environment. 

Do you have any thoughts about this? If you have found some research into this question, please let us know, we're keen to see it!


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