A 14-year legal battle in Ireland has ended with the verdict that the buns used by Subway to make its famous foot-long sandwiches are not legally bread.
The ruling, handed down on September 29 by the Supreme Court of Ireland, was in regard to an appeal of a tax decision originally made in 2006.
In that case, Bookfinders Ltd., an Irish Subway franchisee located near the city of Galway, had applied for a refund of the value-added tax (VAT) it had paid on its takeout products, including its buns, for the previous two years.
The tax authority refused the refund request, as did an appeal commissioner, who upheld the original decision.
Bookfinders then applied to the High Court for relief and was denied. After receiving the same reply from the Court of Appeal, it exercised its final legal option by going to the Supreme Court, from whence came the latest ruling.
In Ireland, by law, bread cannot be taxed, as it is considered a "staple" food. But the country's 1972 VAT Act stipulates that bread ingredients like fat and sugar can't make up more than two percent of the weight of flour used for its dough.
The Supreme Court said that the sugar content in the buns was too high for them to be classified as bread, putting the product in the same category as "confectionery or fancy baked goods".
In its ruling, the five-member court wrote: "There is no dispute that the bread supplied by Subway in its heated sandwiches has a sugar content of 10 per cent of the weight of the flour included in the dough, and thus exceeds the 2 per cent specified."
In a statement, Subway defended its product: “Subway’s bread is, of course, bread. We have been baking fresh bread in our restaurants for more than three decades and our guests return each day for sandwiches made on bread that smells as good as it tastes.”
Subway also said it is reviewing the ruling, noting that the legal definition of bread in Ireland had been modified in 2012.