Denmark, the First Fat Taxing Country

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Last Saturday, Denmark became the first country in the globe impose taxes on products that lead to obesity and being overweight. This led to many consumers hoarding for fatty products like butter, meat, milk and pizza in order to avoid the immediate effects of the tax to the prices of such commodities.

“We have had to stock up with tonnes of butter and margarine in order to be able to supply outlets,” says Soeren Joergensen of Arla Distribution. The almost-ending term of Denmark’s current government designed this new tax scheme in order to limit and regulate the intake of Denmark citizens in terms of fatty foods. The said tax will add about $2.87 per kilo of saturated fats in every product.

“It has been a chaotic week with a lot of empty shelves. People have been filling their freezers,” says Christian Jensen from a local independent supermarket in Copenhagen, Denmark’s capital city. “But actually I don’t think the tax will make that much difference. If people want to buy a cake, they will buy it. But right now they’re saving money,” he added.

The said tax will be levied on many products with saturated fats like oil, meats, ready to eat foods, butter, milk and the like. According to Denmark’s Confederation of Industries, this taxing system is a “bureaucratic nightmare” for producers and outlets.

“The way that this has been put together is an administrative nightmare, and I doubt whether it will give better health. It’s more just a tax,” according to Denmark’s Confederation of Industry foodstuffs spokesperson, Gitte Hestehave. She further said that the burden will just be passed on to the consumers.

Hestehave added that putting the price tag on most domestic and imported products and goods is a complicated step because it will give more burden to the producers by declaring the amount of saturated fat that’s inside each item, as well as during the preparation.

“Products that include other products that include saturated fats also have to have new prices worked out. Imported goods require a declaration from the producers abroad on exactly how much saturated fat has been used in production,” said Hestehave. “As far as we have been able to determine, Denmark is the first country in the world to introduce a fat tax.”

However, many legal experts say that the new Danish Fat Tax may not last for a long time. Jeppe Rosenmejer of the Danish Federation of Small and Medium Enterprises says that the EU is studying the system of taxes as it may cause a sort of competition.

This current legislation allows the distributors to calculate the cost of imported goods on their own, while locally produced items will pay tax at the source. This may mean that domestically produced products might cost more than the imported goods. Also, while the manufacturers are only required to pay taxes for the amount of fat in the finished products, local producers will have to pay for the fat products used in the process of producing the item.

 

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