A LIVERPOOL family business of 36 years’ standing is facing ruin if the Government’s proposal to levy VAT on health drinks comes into force this October.
Tait’s Health Food Store on Dale Street provides a range of remedies and supplements.
A large ratio of its stock is energy drinks – in liquid or powder form – and supplements for sports and fitness enthusiasts to help them recover from exercise, or gain weight.
But in the 2012 Budget, Chancellor George Osborne proposed to include sports nutritional drinks such as carbohydrate drinks, protein drinks, creatine drinks and work-out recovery products, whether or not in powder form, in the VAT band.
Owner Ken Tait, who runs the store with his son Mark, said: “This could raise a question mark over our business and similar type businesses.
“We have been in business all these years and have a decent customer base and I can see that diminishing rapidly.
“The average spend is £40 for a high protein product and that will now be £48. There will be a significant fall off in volumes.”
He said the Government’s proposals are also ambiguous: “They are based on usage rather than content. They don’t intend to propose VAT on slimming-type products. Their intention would be to put it on weight gain and protein powders for people who are looking to gain weight and for muscle recovery post-exercise, ie, footballers, rugby players, martial arts people and boxers – everyone who requires proteins to varying degrees relevant to their sport.”
He added: “The Government had the pasty fiasco when VAT was on, then off, and hit people at the lower end of the health scale and encouraged them to eat fatty saturated foods, and now they are targeting people who are looking after their health and looking to clobber them.”
He said: “I can see a lot of people going online and buying from unregulated businesses out of the UK where who knows what is in their product, to avoid incurring these VAT costs.”
And he said the cost of that could rebound on the Government on two fronts: “The impact of that is not only on the taker’s health, but on the NHS when people have problems with liver and kidneys.
“Then there’s a knock-on effect for manufacturers and the people they employ and the tax they get from those wages.
“This is very short sighted in my mind and will cost considerably more than it will generate.
“We have just had the Olympics in this country and are encouraging people to get healthy and fit and it is sending out the wrong message to people. They are trying to tax something where people are looking after their own health and wellbeing.”
Mr Tait has been a member of business lobby group the Federation of Small Businesses (FSB) for 20 years.
John Allan, FSB national vice-chair, said: “We are trying to keep a nation of fit people to save resources on the NHS, and this is the real Government legacy from the Olympics.”
He said another consequence could be a fall in charity funding: “People take part in marathons and fun runs and raise millions and millions of pounds for charities, which the Government has encouraged.
“Is this the Government’s answer to that – a stealth tax on something that has become so popular?”
The FSB has arranged a day of lobbying at Westminster on September 10, involving members from around the country including 10 from Merseyside, who will meet with MPs and Ministers and Mr Allan said this will be one of the issues raised at the event.
He added: “We want another U-turn.”