Pringles – not enough potato to tax?

by scotslawstudent

Revenue & Customs v Procter & Gamble UK [2009] EWCA Civ 407 sounds at first glance to be one of those many commercial tax cases that are just sent to try us students with copious amounts of critical, yet tedious, detail with mind bogglingly large sums of money dropped in for flavour.

It turns out to be rather more entertaining – making it to the front page of today’s Metro, a free paper not well known for its legal reporting, because it concerns Procter & Gamble trying to prove that their savoury snack is not made of potatoes, to the horror and confusion of shoppers everywhere.

In a similar arrangement to the Jaffa Cake debate (I still don’t know*) the “once you pop you can’t stop” “savoury snack” (says Procter and Gamble) that is Pringles has been thoroughly judged to be a potato crisp.

The real precedential gem in this Court of Appeal judgement does not concern food or tax more than any other field but is the creation of (I believe) a new legal standard to stand alongside the venerable “reasonable man”, the “reasonable professional” and the “moron in a hurry.” It is the standard of the “child at a party.” That is, what would a child at a party interpret the product to be. I find it hard to express in words just how lovely I find this test.

The Court of Appeal ruling has cost the makers of Pringles potentially £100-120 million so I suspect moves to a further appeal are already under way so it remains to be seen if the child at a party will be an interesting bit of obiter or real, live law.

Although on hearing the arguments of the manufacturers I don’t know if the child should have Pringles at his party in the first place. The Guardian sub editors are calling this a “brilliant, ‘our product is rubbish’ defence” and they’re pretty spot on, one of the language arguments (the VAT regulations were distinguished on a made of / made from point) was that you couldn’t say they were made of potato because they were made from nearly equal amounts of fat, a detail sure to warm (and clog, possibly) any mother’s heart.

*the court says cake, yes, but I’m still not convinced