Denmark Enacts First Fat Tax
Though the object of the tax is to improve the health of Danes, it is highly unpopular among the Danes, and many see few, if any, health benefits. Tor Christensen, chief consultant for the Danish Ministry of Taxation, explained the thinking behind this new tax, which passed parliament with almost 90% of the votes: At the political level there was a high degree of consensus for this law. There was wide agreement about trying to improve the average Danish lifespan, about trying to improve the health of the Danish people.
The Danish government has for some time placed a high tariff on sugar, although the tariff was first intended as a revenue measure rather than social engineering. Seven years ago, Denmark became the first nation on Earth to ban trans fats. Health officials claim that this ban reduced Denmark’s rate of cardiovascular disease significantly.
However, even organic food producers are not happy with the newest tax. Poul Pederson, managing director of the organic dairy cooperative Thise Mejeri, said, "It's very frustrating how this has been implemented." He warned that farmers in Denmark will face a major financial hit because of the tax. "We don't know by how much yet because it's very complicated to figure out, but of course we expect sales to go down."
More than just money is involved. Denmark has long prized its intensive farming, particularly dairy farming, as a model for other nations to emulate. Denmark produces high quality dairy products prized throughout Europe, providing a good standard of living to its hard-working farmers. The notion that somehow their products are “unhealthy” infuriates Danish farmers. Pedersen said, "Of course we want people to eat healthfully and no one should be eating a kilo of butter per day. But we in the dairy industry know that we produce a good and healthy product when it's eaten in moderation."
The tax will also ripple through the restaurant industry of Denmark as well, as some of the most popular Danish dishes suddenly cost significantly more. Chef Christian Puglisi of the highly rated Relae restaurant in Copenhagen notes that the tax may be counterproductive to those who want healthier diets: "Organic is already more expensive than industrially produced [food], and the tax will just make it more so. But organic producers can't absorb the price increase the way that industrial can, so fewer people are going to be willing to buy it." As a consequence, more Danes may choose to buy cheaper (non-organically produced) milk, cream, butter, and cheese. As Puglisi says: "The government says it wants to make people healthier, but it's talking with two tongues. It's just going to push more people to buy cheaper industrially produced products, rather than good food. It's insanely stupid."
Physicians in Denmark agree. Dr. Arne Astrup, a professor of human nutrition at the University of Denmark, warns, "You can't predict the health effect of a food by looking at a single nutrient in it. Take cheese, as an example. It's high in saturated fat, but it also contains calcium and protein that seem to change the fat's effect on the body. You would think that people who ate a lot of cheese would have higher risks of cardiovascular disease, but research has shown that's not the case."
There is also the argument that this sort of tax was simply not needed in healthy Denmark. Less than 10% of the population is classified as obese (compared with 34% in America), and Danish life expectancy is 79, among the highest in the world. Dr. Astrup also suggests that the decision to cut trans fats did achieve good health results in Denmark, but the jump to include saturated fats was simply not justified by the research: "They [the government] based their decision on a report written in 2001. In 2001 all the available evidence suggested that we could achieve significant benefits by cutting saturated fats. But it turns out that a lot of that benefit came from cutting trans fats, not saturated ones."
Astrup is also among many in Denmark who believe that concern for the health of Danes masked the real desire of Danish politicians -- to raise more revenue: "This fat tax didn't evolve from proposals by the nutrition council. It was created wholly within the Tax Ministry because they were 1 billion krone short. They didn't do it to cut down on cardiovascular disease; they did it to close a budget gap."
From the October 7, 2011, Prepared Foods' Daily News.