This is a situation in which we cannot possibly be alone. If no one ever brings it up, nothing will change, so if you are in a similar position, and you would welcome a change, please forward, adapt or copy this to your local MP, if the mood takes you.
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Dear Mr White,
We are the Jabberwocky, a street food van based in Leamington Spa serving gourmet toasties and one of a new breed of mobile caterers, who are striving to bring high quality, locally sourced and fresh food to a public who want to eat well even while money is tight. The idea is that we provide restaurant quality food at a fraction the price served in the great outdoors.
In our current situation the VAT threshold, and the placing of VAT on hot takeaway food, will mean that our business and many others like it will not be able to expand. We have recently given up our day jobs to run the Jabberwocky full time, and will soon have to either start turning down work or have to register for VAT.
The current VAT threshold is on a turnover of £79,000. My husband and I can earn a reasonable living within this, but would not be able to employ a member of staff as well without having to earn more, meaning we will struggle to have children or grow the business further. In many industries we could simply register for VAT, but in catering almost all the products we buy are not VATable (fresh bread, meat, cheese and pitches at markets) meaning we would lose 20% of our business instantly in VAT.
We would like to know if there are any plans to help micro businesses like ours expand comfortably so that we, and others in our situation, are able to start a family whilst still being able to work hard, run a business and contribute our fair share.
Thank you very much for your time,
Kind Regards,
Flic (Felicity) Luxmoore
UPDATE 23/12/2013: Chris White responded to my letter.
Correct me if I’m wrong but becoming VAT registered knocks 20% of profit immediately, which means that any sole trader takes a hit of 20% in income. As income tax is 20% doesn’t the decrease in income tax cancel out the income that the treasury receives from the VAT? So for the small trader the treasury achieves very little by adding VAT.
Have you tweeted / emailed this to your MP? Did you get a response back?
[…] weeks ago I wrote a letter to Chris White, MP for Leamington Spa and Warwick, asking if there were any plans in the works for helping the […]