VATupdate Newsletter Week 07 2025

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SEAWEED

Seaweed: the superfood of the sea. Packed with vitamins, minerals, and a hefty dose of trendiness, it graces everything from sushi rolls to posh salads and even high-end skincare products. Rich in iodine, antioxidants, and that elusive aura of wellness, seaweed has been hailed as a miracle food by nutritionists, Instagram influencers, and anyone who’s ever uttered the phrase, “Is this gluten-free?”

But while seaweed may be a gift from the ocean, it is not, alas, exempt from the clutches of taxation. When it comes to VAT, the waters become murkier than a kelp forest at low tide. In many jurisdictions, the VAT treatment of foodstuffs depends on their classification or on their use—basic sustenance is often zero-rated or taxed at a reduced rate, while luxury goods bear the full standard rate. And here’s where things get… slippery.

Dried seaweed, often found in health food aisles and gourmet shops, might be taxed differently from fresh seaweed—if, indeed, anyone is lucky enough to buy it fresh. And let’s not forget seaweed snacks: are they ‘food’ or ‘confectionery’? A harmless packet of crispy nori could attract different VAT rates depending on whether it’s marketed as a health product or an alternative to crisps. Governments, ever alert to the dangers of untaxed deliciousness, tread a fine line between categorization and confusion.

In the UK, for example, the VAT treatment of foodstuffs has created legendary classification debates—Jaffa Cakes being a ‘cake’ and not a ‘biscuit’ springs to mind. It’s only a matter of time before some poor tax tribunal has to decide whether sushi rolls containing seaweed should be taxed at the same rate as a packet of dried kombu.

And in the Netherlands, the reduced VAT rate applies to foodstuffs, suitable for human consumption. It says ‘suitable’, but it actually means that the product must also be used as foodstuff. If seaweed would be used as skincare product, the reduced rate does not apply. So it matters if it is put, in or around your mouth.

Perhaps the most tragic irony of all is that seaweed, growing wild and free in the ocean, is one of the few foods that requires neither farming nor feeding. Yet the moment it’s plucked from the waves and packaged neatly for sale, the taxman arrives like a particularly determined barnacle, latching on and refusing to let go.

So next time you enjoy a seaweed snack, take a moment to appreciate not just its umami goodness but also the bureaucratic entanglements that have helped bring it to your plate. And remember: in the world of VAT, as in the sea, there’s always something lurking beneath the surface. For the latest news, visit www.vatupdate.com.

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