Irish High Court Rules Subway's Sandwich Bread Isn't Legally Bread

The Irish High Court has ruled that Subway's sandwich bread does not qualify as bread due to its high sugar content. This decision came after an appeal by Subway's Irish franchisees. The court stated that Ireland's Value-Added Tax distinguishes between staple foods and optional indulgences, and the sugar content in the bread exceeded the allowed limit. This ruling has implications for the taxation of Subway's sandwiches in Ireland.

Irish High Court Rules
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Contents
Q 1....................................................................................................................................................3
(a)............................................................................................................................................3
(b)...........................................................................................................................................4
Q 2....................................................................................................................................................4
(a)............................................................................................................................................4
(b)...........................................................................................................................................5
References........................................................................................................................................6
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Q 1.
(a).
Demand Point is price elasticity of demands at a certain point on demand curve that
eliminates the entire range. Demand elasticity could be calculated using either Arc or Point
method. For arc elasticity, price is calculated by adding two different points, while in the point
elasticity, price is calculated by adding 2 distinct points on timeline (Baker, Kumar and Pandey,
2021). Except for demands point elasticity, the arc elasticity is required for major shifts
and value stays constant regardless of the price value level shifts. Because of high sugar
content, court ruled that bread sold at Subway, US chain that sells massive sandwiches across
110 nations and territories should not be classified as bread. Decision came after Bookfinders
Plc, Subway's Irish franchisees, filed an appeal. Organization said that bread utilized in
Subway's sandwiches qualifies as staple food and is therefore VAT-free. However, as court said,
Ireland's 1972 Value-Added Tax distinguishes between staple foods like bread, tea, espresso,
cocoa, milk, including "preparations or components of meats or eggs as well as "more optional
indulgences" like ice cream, cake, pastries, biscuits, popcorn, including roasted nuts. The act's
stringent requirement that the quantity of sugar element in the bread will not exceed 2percent
of weight of flour used in dough" was the deciding factor. Economics as well as statistics are two
concepts that are intertwined. The powers of demands and supply are at the heart of all economic
operations. Statistics is technique that offers a realistic application for theoretical economic
understanding. As a result, point elasticities of demand could be explained using the following
computational expressions:
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According to law of demand, there is inverse relationship among quantity demanded as
well as price scale as shown by case of Irish High Court Rules Subway's Sandwich Bread
Isn't Legally Bread. Correspondingly, if point elasticity of the demand is used, prices adjust
dramatically, but if Arc elasticity of the demand is used, prices remain relatively unchanged.
This crucial link between economies and statistics aids in correctly describing demand points
(Brenner, 2018).
(b).
Based on above diagram, tax burden may fall more heavily on customers or producers. For
instance, since sandwich are unhealthy habit, demand would be inelastic although taxes are
mostly transferred on to customers in form of higher costs. The study of how tax burden is
distributed among consumers and suppliers is regarded as tax incidence. Tax's incidence/burden,
is usually shared by both buyers and manufacturers of the taxable product. Although, if
company want to see who can carry the brunt of the load, what we have to do is look at
demands and supply elasticity (Tien, 2019).
Tax burden lies on most inelastic side of economy in the case above. Consumers face the
brunt of tax burden when demand is much more inelastic than then supply. When supply is less
elastic than demands, however, sellers bear brunt of tax burden. Consider this: if demand
becomes inelastic, customers are less open to price increases, and when tax is imposed, the
amount demanded remains comparatively stable. Since smokers are hooked to the substance,
demand for cigarettes is inelastic. Without much of drop in equilibrium quantity, seller will
push tax burden onto the buyers in form of greater prices (Kirikkaleli and Ozun, 2019).
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Q 2.
(a).
CSM = 10x10/2 = $50 PSM = 10x10 + 20x10/2 = $200 In order to get the profit, First, Profits =
TR – TC TR = PMQM = 30x10 = $300 Second, TC = Q2 + 140 = 102 + 140= $240 Then,
Profits = TR – TC = $300 - $240 = $60
(b).
CSM = 10x10/2 = $50 PSM = 10x10 + 20x10/2 = $200
In order to get the profit, First, Profits = TR – TC TR = PMQM = 30x10 = $300 Second, TC =
Q2 + 140 = 102 + 140= $240 Then, Profits = TR – TC = $300 - $240 = $60
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References
Books and Journals:
Baker, H.K., Kumar, S. and Pandey, N., 2021. Thirty years of Small Business Economics: A
bibliometric overview. Small Business Economics, 56(1), pp.487-517.
Brenner, B., 2018. Transformative sustainable business models in the light of the digital
imperative—A global business economics perspective. Sustainability, 10(12), p.4428.
Tien, N.H., 2019. International economics, business and management strategy. Dehli: Academic
Publications.
Kirikkaleli, D. and Ozun, A., 2019. Innovation capacity, business sophistication and
macroeconomic stability: Empirical evidence from OECD countries. Journal of
Business Economics and Management, 20(2), pp.351-367.
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