Danish ‘fat tax’ analysed from Australian perspective

Posted by AFN Staff Writers on 3rd October 2011

In a world first, Denmark has introduced a tax on food products high in saturated fats. Despite the move sparking fresh calls for a similar tax law to be introduced in Australia, food industry opinion-makers are divided.

The new tax law, implemented in Denmark on Saturday 1 October 2011, aims at discouraging unhealthy diets as well as offsetting the economic costs of obesity in Denmark.

The law imposes a tax of 16 Danish Krone (A$2.96) per kilogram of saturated fat on meat products, certain dairy products including butter and double cream, extracted animal fats, cooking oils, margarine, and spreadable composite products.

Products containing less than 2.3 percent per weight of saturated fat are exempt from the tax. This means that most types of milk are exempt. Goods for export, non-food items such as additives, animal feed or medicine are similarly exempt.

For dairy products, tax is paid on the saturated fat contained in the product. For meat products, standard rates per kilogram have been set according to the animal, but under certain conditions tax can also be paid according to the saturated fat in a cut.

Australian anti-obesity activists call for Australian Government to investigate fat tax

Senior adviser of Australian anti-obesity Obesity Policy Coalition, Jane Martin told Australian Food News today that the Australian Government should keep a keen eye on the impact Denmark’s new ‘fat tax’ will have on obesity levels.

Ms Martin said the new Danish tax system is something Australian Government should investigate in line with recommendations made by the National Preventative Health Taskforce in May 2009.

“We know that price is a key driver in consumers’ decisions and there is a big gap between the relative prices of healthy versus unhealthy food products in Australia. For instance, the cost of fruit and vegetables is increasing at a higher rate than the cost of processed foods.”

Is ‘fat tax’ too simplistic?

Food industry lawyer Joe Lederman, from food law specialists FoodLegal, told Australian Food News that while it is clear saturated fats contribute to bad health, the story may not be so simple.

Mr Lederman said, “According to some cardiac nutritionists, there are different types of saturated fatty acids with differing health effects, not all of which have the same effect on cholesterol levels. For example, some nutritionists have pointed out that myristic acid and palmitic acid both elevate LDL cholesterol (bad cholesterol), but other types of saturated fatty acids, such as lauric acid and stearic acid may show smaller impact on LDL cholesterol or the HDL/LDL ratio.”

Mr Lederman said he was not a medical expert but he believed that a law aimed at targeting a single but broadly described nutrient would need to be carefully drafted and monitored.

“Implementation would need to be carefully monitored so that it did not miss the intended mark,” he said. “Care would also be needed to avoid a switchover into other high-calorie dietary alternatives that might not have the intended healthier effect,” he added.