The US firm which owns the Build-A-Bear Workshop has to pay £600,000 tax, after judges ruled that a teddy’s boots are different from those of dolls!
The St Louis-based company lost a three-year battle with HMRC over customs duty on clothes, wigs and shoes worn by the bears that children ‘create’ in their shops. Under UK law items deemed dolls’ accessories have a nil duty rating., however stuffed toys incur a 4% duty. Two tax tribunals have now upheld HMRC’s claim that clothes for stuffed bears are stuffed toy accessories!
During the ruling the judges said the shoes would not fit on humanoid feet (dolls), and had to be rounded for the bear’s foot.
