The Treasury has been pressed to intervene in the burgeoning cottage industry of home-based cake decorators, a sector now generating weekly earnings of up to £1,000 in some cases. The demand for protectionist measures follows a sharp increase in the number of confectioners operating from domestic kitchens, a trend accelerated by the pandemic and the rise of social media marketing.
Industry bodies argue that existing regulations, designed for commercial bakeries, impose disproportionate costs on smaller operators. Licensing requirements, hygiene inspections and VAT thresholds are seen as barriers to growth. The British Baking and Pastry Association (BBPA) has submitted a formal request to the Chancellor, seeking a tailored regulatory framework that recognises the distinct nature of this craft.
Current rules require any food business to register with local authorities, but enforcement is inconsistent. Many home bakers operate informally, relying on word of mouth or platforms such as Instagram and Facebook. The Treasury's primary concern is tax compliance: unreported income from cake sales could represent a significant shortfall. Estimates from the Centre for Economics and Business Research suggest the sector may be worth over £200 million annually, much of it untaxed.
The BBPA's proposal includes a simplified registration scheme, reduced inspection fees and a higher earning threshold before VAT registration becomes mandatory. They also recommend formal guidance on food safety standards tailored to low-volume production. "We are not asking for lax rules, but for rules that fit the scale and nature of this work," said BBPA chair Helen Granger. "A single mother decorating cakes in her spare time should not face the same burden as a high-street bakery."
Critics, however, warn that lighter regulation could compromise food safety. The Chartered Institute of Environmental Health (CIEH) has urged caution. "Any easing of standards must not put consumers at risk," said CIEH policy officer Mark Fielding. "We have seen cases of cross-contamination and undeclared allergens in home-produced goods. A separate framework would need robust oversight."
The Treasury has not commented directly but is understood to be reviewing the submissions. A source indicated that officials are considering a pilot programme for a tiered licensing system, with lower fees for micro-enterprises earning below a certain threshold.
For many home bakers, the issue is urgent. Sarah Mitchell, who runs a cake business from her kitchen in Oxfordshire, reported weekly earnings of around £800. "I could easily double that if I could buy proper equipment and take on a part-time assistant, but the regulatory uncertainty means I cannot plan," she said. "The Treasury needs to act before this industry is forced into the shadows."
The development highlights a broader tension between the gig economy and established regulatory regimes. As digital platforms enable new forms of micro-entrepreneurship, government must adapt its frameworks without stifling innovation or jeopardising public safety. The Treasury's response to the BBPA's plea will be closely watched as a bellwether for policy in other cottage industries.
