The Danish fat tax

May 27th, 2013 at 1:00 pm by David Farrar

Paul Walker blogs a summary of a new report by Christopher Snowdon on The Proof of the Pudding: Denmark’s fat tax fiasco. The findings are:

  • Denmark’s on saturated fat was hailed as a world-leading public health policy when it was introduced in October 2011, but it was abandoned fifteen months later when the unintended consequences became clear. This paper examines how a policy went from having almost unanimous parliamentary support to becoming ‘an unbearable burden’ on the Danish people.
  • The economic effects of the fat tax were almost invariably negative. It was blamed for helping inflation rise to 4.7 per cent in a year in which real wages fell by 0.8 per cent. Many Danes switched to cheaper brands or went over the border to Sweden and Germany to do their shopping. At least ten per cent of fat tax revenues were swallowed up in administrative costs and it was estimated to have cost 1,300 Danish jobs.
  • The fat tax had a very limited impact on the consumption of ‘unhealthy’ foods. One survey found that only seven per cent of the population reduced the amount of butter, cream and cheese they bought and another survey found that 80 per cent of Danes did not change their shopping habits at all.
  • The fat tax was always controversial and it became increasingly unpopular as time went on. Objections came not just from business owners, but also from trade unions, politicians, journalists and the general public. It was widely criticised across the political spectrum for making the poor poorer. By October 2012, 70 per cent of Danes considered the tax to be ‘bad’ or ‘very bad’ and newspapers routinely described it as ‘infamous’, ‘maligned’ and ‘hated’. Mette Gjerskov, the minister for food, agriculture and fisheries, admitted in late 2012: ‘The fat tax is one of the most criticised policies we have had in a long time.’
  • Denmark’s fat tax remains the leading example of an ambitious anti- policy being tested in the real world. The results failed to match the predictions of the health lobby’s computer models and the failed experiment has since been largely swept under the carpet in public health circles. Ultimately, Danish politicians weighed the negligible health benefits against the demonstrable social and economic costs and swiftly abandoned it. Few mourn its passing.
  • The economic and political failure of the fat tax provides important lessons for policy-makers who are considering ‘health-related’ taxes on fat, sugar, ‘junk food’ and fizzy drinks in the UK and elsewhere. As other studies have concluded, the effect of such policies on calorie consumption and obesity is likely to be minimal. These taxes are highly regressive, economically inefficient and widely unpopular. Although they remain popular with many health campaigners, this may be because, as one Danish journalist noted, ‘doctors don’t need to get re-elected.’

There are lessons from this regarding all sorts of targeted taxes. They can sound great in theory, but can be a disaster in practice.

Hat Tip: Whale

Tags: ,

14 Responses to “The Danish fat tax”

  1. Bob (497 comments) says:

    It also shows what happens when you try to regulate people’s personal lives. Remember Helen Clark’s nanny state? In a free country it has to be influence by education.

    Vote: Thumb up 5 Thumb down 0 You need to be logged in to vote
  2. queenstfarmer (782 comments) says:

    In 2011, Tony Falkenstein was citing Denmark in callng for a fat tax in New Zealand. He asked the question:

    So, why not a fat tax here? That will happen, as we assess the results of the Danish tax …

    Of course I’m sure Tony’s call for a tax on sugar has nothing to do with his business selling water.

    Vote: Thumb up 6 Thumb down 0 You need to be logged in to vote
  3. Nigel Kearney (1,019 comments) says:

    Taxing fatty food is doomed to failure as you can’t also tax lack of exercise.

    All that is needed is for fat people to pay extra through their health insurance, and insurers will work out the correct amount. If the state insists on paying for health care, they can instead subsidise private insurance based on age and pre-existing conditions but not BMI.

    Vote: Thumb up 3 Thumb down 0 You need to be logged in to vote
  4. Kea (12,841 comments) says:

    This is the sort of law you get when women dominate your society. They probably hoped a law change would help fix their fat arses and inflicted this monstrosity on the Danish people.

    This sort of sillyness will continue for as long as we allow them to vote. ;)

    Vote: Thumb up 5 Thumb down 5 You need to be logged in to vote
  5. A Nonny Mouse (15 comments) says:

    “The fat tax was always controversial and it became increasingly unpopular as time went on. Objections came not just from business owners, but also from trade unions, politicians, journalists and the general public. It was widely criticised across the political spectrum for making the poor poorer.”

    So business owners *and* unions objected to it! Astounding!

    Vote: Thumb up 2 Thumb down 0 You need to be logged in to vote
  6. Manolo (13,840 comments) says:

    A defeat for the food-nazis. What will the Anti-obesity Coalition would have to say?
    C. Lashie anyone?

    Vote: Thumb up 3 Thumb down 0 You need to be logged in to vote
  7. MT_Tinman (3,205 comments) says:

    Long live fat bastards (and they generally do)!

    Vote: Thumb up 1 Thumb down 0 You need to be logged in to vote
  8. The Scorned (719 comments) says:

    Sat fat doesn’t make you fat nor causes heart disease…carb’s and sugar do that. So its a fail from the get go.

    Cholesterol isn’t to blame for arterial damage….inflammation is…..and exercise does near nothing to make you slimmer by burning fat.

    Vote: Thumb up 2 Thumb down 1 You need to be logged in to vote
  9. mara (788 comments) says:

    The Scorned, you are correct as far as you go. Fatty food itself will not cause obesity or sclerosis BUT combined with carbs and suger, the calorie load of fat tends to cause weight gain. As I learned from experience, dropping carbs/sugar to a minimum meant I lost weight and got healthier whilst eating high fat/protein calorific foods. Health Nazis are useless, the more so when they are ill -informed and hold fast to discredited, last century “science.”

    Vote: Thumb up 1 Thumb down 1 You need to be logged in to vote
  10. Kleva Kiwi (289 comments) says:

    Socialism dosn’t work eh
    Who woulda thunk?

    Vote: Thumb up 1 Thumb down 0 You need to be logged in to vote
  11. The Scorned (719 comments) says:

    Mara…..the calorie load in fat is irrelevant. Calories in -out is not whats important in body fat gain-loss. Its HOW the calories you take in are packaged. Sat fat and protein are used very differently by your body than carb’s and sugars are. It is very possible to eat more calories in the shape of Sat fat than you may have been in carbs/sugars and yet lose body fat weight.

    Calories in -out fails to answer the real question which is “WHY do some people over eat?”.

    Growing evidence is showing that its a genetic issue involving insulin and the regulation of the working of fat cells.

    If you are genetically lucky you will be trim and your body allows energy in and out with no problem. If you are unlucky your body retains energy in fat cells while the rest of your body is staved and so you are always feeling hungry causing you to eat more and feel less likely to move…..and round it go’s.

    Vote: Thumb up 1 Thumb down 0 You need to be logged in to vote
  12. The Scorned (719 comments) says:

    https://danceswithfat.wordpress.com/2011/03/06/the-calories-incalories-out-myth/

    https://danceswithfat.wordpress.com/2011/06/02/calories-incalories-out-science-says-no/

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  13. Steve (North Shore) (4,565 comments) says:

    Getting fat or large happens when the input hole is bigger than the output hole.
    That is Physics 101

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  14. Tom Jackson (2,553 comments) says:

    Fat people and smokers are the new gays – the puritans have just switched targets.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote