This post was most recently updated on June 29th, 2018
On the back of the recent Budget squabbles over VAT such as the pasty tax, Guide Dogs UK have launched a campaign to have VAT removed from the dog food they purchase. It’s estimated that the annual VAT cost is £300,000, which could be much better spent training more guide dogs instead of going to the Chancellor. In fact, the £300,000 would cover the cost of training approximately six extra guide dogs per year.
Interestingly there are already exemptions from VAT for “specially formulated food held out for sale exclusively for working dogs” such as “dogs trained and used as gun dogs”, “working sheep dogs of any breed” and “racing greyhounds”. Police dogs and packs of hounds were added to the list recently (see below), but guide dogs were not, which is nonsensical. If you asked a random person from the high street to name a “working dog”, you’d probably get guide dogs as one of the first answers.
The snag is that the food has to be specially formulated for specific working dogs in order to attract the zero-rating for VAT, which basically means a high protein formulation for those active, working dogs. Unfortunately, that high-protein formulation is unsuitable for most guide dogs and hearing dogs who are not active all day, but rather are working in a different capacity by way of helping their disabled owners.
Not only does the cost of VAT affect the Guide Dogs and similar charities during the long training periods for young dogs, but also the owners of the trained dogs who will be the ones buying the dog food for the working life of the adult dog. Often the disabled owners are among the sections of society least able to afford the additional cost of VAT, especially on something so essential at their guide dog’s food!
There is no definition in the VAT Act of what constitutes a pet. However, in the appeal of Pope’s Lane Pet Food (MAN/86/0148), the tribunal offered its own definition: In my judgement a pet is an animal (tamed if it was originally wild) which is kept primarily as an object of affection, in which I would include an animal kept primarily for ornament.
On the basis of this definition we can identify a number of animal species as pet species in that all, or the great majority, of individuals of that species are kept and reared as objects of affection. Pet species are listed in Notice 701/15, Food for animals.
In their original drafting of the law, Customs and Excise assumed that dogs would be seen as a pet species, and food for dogs would automatically be seen as pet food. However, this concept was not accepted by the tribunal, who cited the large number of dogs who are kept as working animals rather than as pets. Specifically, in the case of Pope’s Lane Pet Food Supplies, the tribunal picked out sheepdogs, police dogs, guard dogs, gun dogs, racing greyhounds and a pack of hounds as examples of dogs which are not pets. Therefore not all food for dogs is standard-rated.
What’s interesting is that how guide dogs are so obviously NOT pets as defined by HMRC. While they are also not working dogs that require a specific high-protein diet, they are working dogs in that they provide a service to the owner which a normal pet would not be able to provide.