Is a sweet sandwich still a sandwich? The M&S confectionary debate.

The M&S strawberries and cream sandwich has been all over social media, with shoppers desperate to get their hands on the Japanese-inspired fruit sandwich. This unique take on the classic sandwich, with a sweetened brioche bread and a dessert-like filling of strawberries and cream, has led to major demand across the country. However, despite its popularity, the product has also sparked a legal debate that could have significant financial implications for M&S. 

This is not the first time a popular snack has found itself at the centre of a legal tax dispute, as in 1991 Jaffa Cakes were discussing a similar question: was the Jaffa Cake a cake or a biscuit? This famous legal case hosted a debate over the product’s core characteristics, in which the court analysed its texture, ingredients and even how it hardened when stale. Ultimately, the ruling determined that Jaffa cakes were cakes, thus exempting them from VAT. This case from 1991 serves as a reminder that the distinction between a snack and a dessert is significant for tax law, as the outcome can be costly. 

Elements of this historical legal case are also evident in the current M&S dispute, with the classification of the sandwich determining its VAT treatment: if it is considered a sandwich, it is VAT exempt, but if it falls under the category of confectionary, it is subject to the standard 20% VAT rate. M&S’s argument to be VAT exempt is based on its familiar sandwich shape, its location in the sandwich aisle and its packaging. Opponents are countering by presenting arguments around its sweetened bread and dessert-like filling, which align with HMRC’s definition of a dessert. 

Ultimately, this debate over a strawberry filled sandwich highlights the ways in which tax law impacts consumer goods, as subtle distinctions can impact a company’s tax treatment, thereby influencing pricing, overall revenue and more.