The bread at Subway might be baked fresh, but according to the Irish Supreme Court, it’s not legally bread.
The five-judge court ruled Tuesday that the bread Subway uses for its sandwiches fails to comply with the legal definition of bread in Ireland. According to the Value-Added Tax Act of 1972, part of the legal qualifications of bread is that sugar cannot constitute more than 2% of the total weight of flour in the dough.
All of Subway’s bread options, according to the ruling, surpassed that percentage, reaching about 10%.
The case was brought to the court because of a 2006 decision by the Irish Revenue Commissioners not to refund value-added taxes that were levied on Subway’s products between 2004 and 2005 at a rate of 13.5%.
The Value-Added Tax Act “seeks to distinguish between bread as a staple food, which should be 0% rated, and other baked goods made from dough, which are, or approach, confectionery or fancy baked goods,” according to the ruling. Brookfinders Ltd., the Subway franchisee involved in the suit, argued that its bread was a staple food product and should thus be exempt from the 13.5% tax.
The Supreme Court rejected Brookfinders’s argument. “The argument depends on the acceptance of the prior contention that the Subway heated sandwich contains ‘bread’ as defined, and therefore can be said to be food for the purposes of the Second Schedule rather than confectionery. Since that argument has been rejected, this subsidiary argument must fail,” the court wrote.
This is not the first time Subway has gotten burned for ingredients in its bread: In 2014, a petition began circulating to get Subway to remove azodicarbonamide from its ingredients list. The chemical can be used as a dough conditioning agent but is commonly found in yoga mats. The chemical is banned as a food additive in the European Union.
