Tax Will Not Cut the Fat
Denmark has decided in recent days that it will repeal the fat tax introduced over a year ago that is levied on foods with a certain level of fat and above. The Danes have also decided not to go ahead with their planned ‘sugar tax’, an extension of the chocolate tax. The move is a victory for common sense, even though it actually took until the tax was operational for the Danish Government to realise that it was a silly idea that was never going to work.
The Danes love their taxation, they are one of the world’s top taxing nations so of course it was almost inevitable, with a worldwide obesity crisis continuing to grow, that they, or another European nation would be the first country in the world to put a tax on high-fat foods. In the end, the Danes went first with a tax adding 16 kroner per kilogram of saturated fat.
In looking at the results of the tax the Danish political establishment found that their world-leading tax was costly to business, but more importantly, failed to change the eating habit’s of Danes. The levy on saturated fats was also a bureaucratic nightmare, having being levied on all food products containing saturated fats.
The government of Denmark found that part of the reason the tax did not work was because Danes travelled across the border to purchase foods high in fat once the tax was introduced.
The Australian Government and others around the world contemplating placing a tax on saturated fats and high-sugar products must learn from the Danish example. Governments must realise both that a fat or sugar tax will not work in combating obesity and that because such a tax will not work, they would be asking business to take on extra costs for no benefit.
There are a few things that government needs to know about introducing a fat tax and the Danish example might finally make politicians realise those facts.
First and foremost, taxing to change behaviour is a stupid concept. In fact, what a tax attempting to change behaviour is doing a lot of the time is actually taxing stupidity. Common sense cannot and should not be legislated for unless it is in order to prevent harm to others. Eating fatty foods is not a crime against your friend, your neighbours or strangers. Having an unhealthy
A tax on saturated fats or fast food just increases the price of fast food. A tax put on foods that are bad for us will not ever magically make healthy foods more accessible than poor food choices.
Not only that but increasing the cost of foods with saturated fats on any level would make it difficult for low-income earners to be able to afford food. People that are on low incomes are already struggling and do not need to be struggling to eat.
Government also needs to think about why foods high in fat, salt or sugar are increasingly the choice made by Australians in their day-to-day lives. In some cases it is not quite as simple as people willingly choosing the worst food option.
First and foremost, unhealthy foods are cheaper. Fast food and more generally, all foods high in fat, salt and sugar cost much less than fast foods and that has been a reality for a long time,
It must also be recognised that we are getting busier as a nation. People are working longer hours and getting more tired. Consequently, fast and convenient food is an increasingly sought after product and again, that is usually processed, high in fat, salt and sugar.
Subsidising healthy food is an option but it would prove extremely costly and would still not work. Subsidising anything is also something that a government should avoid at any cost.
There is a role for educating people about healthy food choices, starting at an early age to instil the benefits of good food choices. Again though, this is a part solution.
The problem is a difficult one, but as Denmark has shown, taxing eating habits is not the answer.
Posted on November 13, 2012, in International Politics and tagged chocolate tax, choice, cost to business, Danish Government, Denmark, ease of access, eating habits, fat tax, personal choice, repealing the fat tax, subsidising healthy food, sugar tax, taxing behaviour, work patterns, world's first fat tax. Bookmark the permalink. 1 Comment.