Irish bakers could suffer as a result of a move by Revenue to significantly hike up the price of bagels, croissants and garlic bread.
It has decided that these type of bakery products could increase in price by as much as 13.5%, because they were not sufficiently bread-like to be exempt from VAT.
Michael Noonan, Ireland’s Finance Minister, met with representatives of the Irish baking industry to discuss the move and explained that nothing would change for at least a week until further consultations.
Bakers, suppliers and retailers are thought to be angered by the decision as they felt they had not been properly informed about the new VAT rules, as well as the products that fall into this category, which could heavily affect their businesses.
One supplier told The Irish Times that they had received no formal notification from Revenue and had only come across the information on its website by accident.