Bread and bakery products

What VAT rates apply to bread?

The supply of bread may be liable to Value-Added Tax (VAT) at the zero rate, reduced rate, or the second reduced rate depending on the particular bread product concerned and the circumstance in which it is supplied.

Further guidance contains more detailed information on the VAT treatment of bread.

What VAT rate applies to bakery products?

The supply of bakery products, such as, cakes, biscuits, bagels and croissants, being flour or egg based bakery products, is liable to VAT at the reduced rate.

The supply of bread that meets the ingredient definition under VAT legislation is liable to VAT at the zero rate. The ingredient definition of bread is very specific. Although products, such as, garlic bread, onion bread and fennel bread are marketed as bread, these products do not generally conform to the ingredient definition of bread under VAT rules and, therefore, do not qualify for the zero rate of VAT.

The reduced or second reduced rate may apply if the bread or bakery product is supplied in the course of a meal.