Urban Food Chains

the links between diet and power

food manufacture food production
A good read
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William Sitwell’s book Eggs or Anarchy tells of the logistical struggle to feed the UK during the second world war. Its quality lies in the author’s insight into the interplay of power, politics and military muscle. Verging on understatement, Sitwell’s account of a gargantuan effort to achieve the almost impossible.

Among the illustrations that appear is a map of the world showing the sea routes taken by different wartime food imports, listing the distance travelled by each  commodity. The map once hung in the Minister of Food’s office and carried a stern warning about not wasting food that had travelled so far and was part of the war effort.

A seasoned business man, Frederick Marquis was elevated to the House of Lords, taking the title Lord Woolton. He was appointed food minister by Neville Chamberlain. Retained by Winston Churchill, Woolton worked tirelessly to overcome the ever steeper challenges that he faced in office. His lack of experience in political life was both a hindrance and a blessing in disguise, giving him the freedom to pursue policy targets without compromising political goodwill.

Woolton demonstrates the complexity of real world logistics and how political considerations can deflect attention from operational necessities.

customs clearance haulage key concept
Import VAT
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In today’s economy there is a big difference between the place of production and the place of importation. The place of importation today is the customs post which is clearing goods for onward travel. At the turn of the twentieth century in the days of empire, it is arguable that the UK national frontier included or contained the colony concerned. One can be sure, however, that customs duty would not have been expected on goods leaving a colony and arriving in the UK.

In today’s post-Brexit economy, however, things are a bit different. The place of production determines the rate at which duty is payable (or zero percent, depending on the provenance of the goods). Regardless of duty, however, import VAT is due and can be considered a fiscal rite of passage. A consignment of goods arriving at a UK border post will have a customs value: this is the aggregate of the value of the goods, insurance, shipping and administrative costs (such as phytosanitary checks for plant material).

Zero duty goods will not be charged import VAT on the zero duty, but will be charged VAT on the rest of its customs value, at the applicable UK rate. Since import VAT is an aggregate, it will be levied on each component of the consignment at the applicable rate of VAT, for example haulage from point of origin to the customs post will be charged at 20%; food safety checks at, say, GBP 450 per container will be taxed at 20%, likewise freight insurance and office admin costs. In short, zero-duty goods will escape customs duty but not import VAT. The implementation of Sanitary and PhytoSanitary (SPS) checks in July 2023 will add another administrative layer to food imports as well as increased levels of import VAT when customs values rise.

The increased cost of importing food — or anything else for that matter — will not go unnoticed. The government’s additional tax revenue will take a bit of explaining. There is not a queue of UK politicians waiting to sell this delicate state of affairs to the electorate.