Nov 28 2012

The Danish fat tax: reflections on its demise.

My latest publication is a commentary on the reversal of the Danish fat tax in New Scientist, November 26:

Fighting the flab means fighting makers of fatty foods

A YEAR ago in these pages, I congratulated the Danish government on its revolutionary experiment. It had just implemented a world-first fiscal and public health measure – a tax on food products containing more than 2.3 per cent saturated fat.

This experiment has now been dropped. Under intense pressure from the food industry in an already weak economy, the Danish government has repealed the fat tax and abandoned an impending tax on sugars.

Nobody likes taxes, and the fat tax was especially unpopular among Danish consumers, who resented having to pay more for butter, dairy products and meats – foods naturally high in fat.

But the real reason for the repeal was to appease business interests. The ministry of taxation’s rationale was that the levy on fatty foods raised the costs of doing business, put Danish jobs at risk and drove customers to buy food in Sweden and Germany.

In June this year, a coalition of Danish food businesses organised a national repeal-the-tax campaign. The coalition said that fat and sugar taxes would cause the loss of 1300 jobs, generate high administrative costs and increase cross-border shopping – precisely the arguments cited by the government for its U-turn.

We can now ask the obvious questions. Did the tax achieve its aims? Was it good public policy? What should governments be doing to reduce dietary risk factors for obesity?

The purpose of food taxes is to reduce sales of the products concerned. In bringing in its fat tax, the Danish government also wanted to raise revenue, reduce costs associated with obesity-related diseases, and increase health and longevity. A year is hardly time to assess the impact on health, but the tax did bring in $216 million. Danes will now face higher income taxes to make up for the loss of the fat tax.

Business groups insist that the tax had no effect on the amount of fat that Danes ate, although they chose cheaper foods. In contrast, economists at the University of Copenhagen say Danish fat consumption fell by 10 to 20 per cent in the first three months after the tax went into effect. But it is not possible to know whether it fell, and cross-border shopping rose, because of the tax or because of the slump that hit the Danish economy.

A recent analysis in the BMJ suggests that 20 per cent is the minimum tax rate on food to produce a measurable improvement in public health. The price of Danish foods hit by the tax increased by up to 9 per cent, enough to cause a political firestorm but not to make much of a difference to health.

Is a saturated-fat tax good public policy? A tax on sugary drinks would be a better idea. To see why, recall that obesity is the result of an excess intake of calories over what we burn. Surplus calories, whether from carbohydrate, protein or fat, are stored as body fat. All food fats are a mix of unsaturated and saturated fatty acids; all provide the same number of calories per unit weight.

Saturated fats raise the risk of coronary heart disease, although not by much. Trans fats, banned in Denmark since 2003, are a greater risk factor. Because the different saturated fatty acids vary in their risk, imposing a single tax on them as if they are indistinguishable is difficult to support scientifically.

For these reasons, anti-obesity tax measures in other countries have tended to avoid targeting broad nutrient groups. Instead, they focus on processed foods, fast food or sugary drinks – all major sources of calories. Taxing them seems like a more promising strategy.

What else should governments be doing? That they have a role in addressing the health problems caused by obesity is beyond debate, not least because they bear much of the cost of dealing with such problems. In the US, economists estimate the cost of obesity-related healthcare and lost productivity at between $147 billion and $190 billion a year. The need to act is urgent. But how?

One lesson from Denmark is that small countries with open borders cannot raise the prices of food or anything else unless neighbouring countries also do so. But the greater lesson is that any attempt to encourage people to eat less will encounter fierce food-industry opposition. Eating less is bad for business.

In the US, state and city efforts to tax sugary drinks have met with overwhelming opposition from soft-drink companies. They have successfully spent tens of millions of dollars lobbying legislators and convincing the public that such measures deprive voters of their “right to choose” or, as in Denmark, can damage the economy.

What’s more, the poor cannot be expected to support measures that increase food costs, even though obesity-related problems are much more common among low-income groups.

If governments really want to reduce the costs of obesity-related chronic diseases, they will have to address the problem at its source: the production and marketing of unhealthy food products.

A review by the American Heart Association cites increasing evidence for the benefits of anti-obesity interventions: food taxes, subsidising healthy foods, media campaigns to promote exercise and good diet, restrictions on portion sizes, and restrictions on the marketing of unhealthy foods and their sale in schools.

Governments must decide whether they want to bear the political consequences of putting health before business interests. The Danish government cast a clear vote for business.

At some point, governments will need to find ways to make food firms responsible for the health problems their products cause. When they do, we are likely to see immediate improvements in food quality and health. Let’s hope this happens soon.

Marion Nestle is the author of Food Politics and What to Eat and is the Paulette Goddard professor of nutrition, food studies, and public health at New York University

  • Eleanor

    Marion,

    Your point that a tax on sugary drinks is more sensible than a tax on saturated fat is a good one based on the science.

    But, it’s interesting that you are still using a “calories-in minus calories-out” model for explaining obesity, as that model does not explain the evidence very well. (see “Good Calories, Bad Calories”)

    We all know intuitively that iso-caloric does not mean iso-metabolic: if you asked someone to eat 1 cup of butter in one day with only steak to accompany it, without even going through the exercise most people would picture getting to the point where they would be gagging at the thought of ingesting any more butter. Yet if we were to combine that 1 cup of butter with classic cookie ingredients most people could do it.

    This intuitive (innate?) sense that the type of food matters is borne out by the over-feeding experiments that have been done. People can’t over feed on meat and fat, we have a sensitive feedback mechanism for recognizing satiety when eating those foods, but it gets thrown off when too many carbohydrates are added to the mix.

    This points to the idea that the type of food does matter — whether it’s carbohydrates, protein, or fat — because the food will be metabolized differently, depending on the composition of the meal.

    Peter Attia, has a nice overview of the metabolic pathway called nutritional ketosis, the pathway we utilize when our carbohydrate consumption is very low:

    http://eatingacademy.com/nutrition/ketosis-advantaged-or-misunderstood-state-part-i

  • Cathy Richards

    I was surprised the Danish did the fat tax before the sugar tax. I had heard a presentation by one of the key people in their trans ban and he implied the sugar tax was next. The saturated fat tax was flawed from the start (some sat fats are good for us!) and it’s very unfortunate that it set a poor precedent for the sugar tax. Canada and other nations were watching the Danish situation carefully, to see if the water temperature justified a big cannonball jump into the sugar tax ocean. Too bad it went this way.

  • http://hopefulgeranium.blogspot.co.nz/ George @ The High Fat Hep C Diet

    The irony is that junk food is made with the less saturated fats, whereas butter and meat are actually nutritious foods; raising the price of these means that the poor have less access to protein and vitamins, and are more likely to buy junk.

    The saturated fat – heart disease link is either non-existent (the Cochrane Colaboration meta-study) or so piffling that it should play no part in the public health debate. Furthermore, and of major importance, heart disease is not the only cause of death or disability, and saturated fat may be protective against other forms of harm; the evidence that saturated fat protects against alcoholic and drug-induced liver disease is extremely consistent across all types of study, and there may be other examples.

  • http://hopefulgeranium.blogspot.co.nz/ George @ The High Fat Hep C Diet

    P.S. I believe Hungary still has a tax on salt and sugar in processed food.

  • JR

    Ms. Nestle continues, despite the growing body of science, to insist that all calories are equal when it comes to making us fat. It’s just not so. Drs. Lustig and Eenfeldt have published studies pointing to carbohydrates and sugars as the primary causes of obesity. Our bodies process carbs into stored fat. Our bodies do not store saturated fats as body fat. Eenfeldt, at Lund University in Sweden, has pioneered research demonstrating that high fat diets can be quite healthy, and high carb diets make us fat and sick. It’s likely that the growing movement toward High fat, low carb diets in Denmark’s neighbor, Sweden, was another factor in dropping that fat tax.

  • http://hopefulgeranium.blogspot.co.nz/ George @ The High Fat Hep C Diet

    While I generally agree with you JR, most of the fat stored on a normal, mixed, junkfood diet will in fact be dietary fat (though not just saturated). Our bodies do store saturated fats – that’s why they’re in animals – but elevated glucose and insulin is generally the trigger to do this.
    In the context of a junk food, high-carb diet, restricting fat makes sense to some degree; in the context of a traditional, whole food, animal based diet, it is insanity.

  • http://hopefulgeranium.blogspot.co.nz/ George @ The High Fat Hep C Diet

    R.D. Feinman – “dietary carbohydrate determines the fate of dietary fat”

  • Benboom

    The elephant in the room here is Gary Taubes. Ms. Nestle quotes him approvingly when it suits her (see recent posting on sugar) and ignores him when it does not. But she has got to deal with this troublesome priest (apologies to Shakespeare) since nobody seems willing to do it for her.

    Marion, since you plainly disagree with Mr. Taubes’ world view (ie, “Good Calories, Bad Calories”), would you mind explaining why? Ignoring him won’t make him and the people who believe what he does go away. I would really like to hear your reasons for this but so far…nothing.

  • Marion

    @Benboom et al: For my understanding and interpretation of the research on calories, please read my book with Dr. Malden Nesheim, “Why Calories Count: From Science to Politics” (University of California Press, 2012).

  • http://burningbird.net Shelley

    Oh, lord, I can’t stand the Paleo diet fanatics.

  • http://evilcyber.com evilcyber

    All this talk about taxing and outright banning calorie-laden foods very much reminds me of the great experiment that Prohibition was, “experiment” being a term you introduced here.

    If you don’t get people to understand why they shouldn’t eat copious amounts of certain foods, bans and taxes will backfire.

  • B.

    Taxes do change behaviour. When my mother could no longer afford cigarettes because of the increased taxes in CA, she found a way to quit. She had smoked for decades and I was very proud of her.

  • Hylton

    Not only were the naturally high fat foods (butter, dairy products and meats) taxed in Denmark suspect for health reasons, they tend to have a large environmental production footprint.

    I realize you comment mainly on your subject of expertise, nutrition, but as your blog is titled Food Politics, it feels fair to mention the environmental costs of food.

    Anyway, I’m not sure if the tax was a good idea or a bad one, but I wish the social experiment was able to run longer, a couple years maybe, to get some better data either way.

    I feel for Marion Nestle, having the high fat crowd constantly berating her as if she is uneducated in nutrition and has never heard of the alternative views of Taubes et al.

    Nestle has made her views abundantly clear on the subject, ad nauseam.

  • Margeretrc

    Glad to see R.D. Feinman quoted here. His qualifications are on a par with those of Dr. Nestle. Check out his blog at http://rdfeinman.wordpress.com/2012/02/
    @George…:”In the context of a junk food, high-carb diet, restricting fat makes sense to some degree; in the context of a traditional, whole food, animal based diet, it is insanity.” I whole-heartedly agree.
    I’m glad the Danish Fat tax fell through, whatever the reasons. Perhaps that will give the powers that be pause before instituting something like that here. Natural fat is not the problem. As @Eleanor said, we have natural, built in controls to keep us from eating too much fat as long as we restrict our consumption of sugar and starch. We’ve been limiting/reducing our natural fat consumption for decades, in favor of carbohydrates and industrially processed vegetable oils and trans fats. Has that solved the obesity problem? Um, hardly. Maybe it’s time to try another tack. You know what they say about insanity: It’s doing the same thing over and over and expecting different results.

  • http://www.lowcarbcharlie.com Charlie L

    Dr. Nestle – I’ve read most of your “Why Calories Count” book so far and noticed you quote exactly one sentence from Gary Taubes’s work. The rest of your references to Taubes are indirectly from folks critical of his work (and probably sympathetic to your own), like Bray. Having read Taubes’ work directly myself, though, I don’t interpret him as advocating that calories don’t count but that the human body does not count or treat all calories equally, which is more of what his carbohydrate-insulin-obesity language is aimed at. He’s saying that calories from sugar and fructose count worse in relative comparison to other sources of food calories consumed. Unless you’re arguing (and I’ve misinterpreted your writing) that all calories count equally in the human body (as opposed to a lab calorimeter) regardless of source, then there really is no substantive disagreement between you and Taubes on the issue of whether calories count or not.

    What I also find interesting is that when low-carb diets are mentioned throughout the book you bemoan the fact that many of such clinical studies have high drop-out rates, are less than 6 months in duration, and many times rely on self-reported data, or are in controlled settings versus normal free-range environments–all valid points to consider when evaluating claims based on any diet studies, I feel–but when you want to demonstrate that calories do count (as the book title suggests), you’re perfectly willing to let, for example, a 10-week weight loss twinkie experiment done by one participant escape similar criticism.

    All of this isn’t to say that I didn’t find the book an interesting read (for instance, I loved the history you detailed on calorie measuring and the analysis of food politics in relation to calories), but for reasons of personal success and having tried the whole move-more, eat-less, calories-in-calories-out wisdom, I’m more critical of these particular aspects of your work.

  • http://www.TheHealthCulture.com Jan Henderson

    When I tweeted this post yesterday, someone (@EPHA_EU) was kind enough to direct me to an interesting article on what’s happening in Russia (http://bit.ly/TunqYD). Russia is considering a 10-20% tax on meat and dairy products due to their cholesterol content. A source in the Federal Service on Surveillance for Consumer Rights Protection and Human Well-Being told Globalmeatnews.com that “in Russia, food containing antibiotics, pesticides, GMO and harmful additives is a major problem. Consumers are generally not interested in the healthiness of products, paying more attention to the price.” Meat without antibiotics is sold in specialized health food stores at two to three times the price of meat in regular stores. Evidently there is a concern that increasing the price of meat by adding a tax would confuse those consumers who are looking for healthier food (as opposed to “potentially dangerous products”).

    There’s also a proposal to tax fast-food products. I thought this was an interesting glimpse into a country where I rarely see news on this subject.

  • John

    I heard you on Splendid Table. It’s wonderful that you’re trying to unravel this tangled mess. You know every big “Bill” is full of such nonsense: the Highway Bill?! Can you imagine how insanely allocated and misspent “Defense” $$$ are?! I live near WPAFB, and at the end of the fiscal year a scrap yard there receives a mountain of new office furniture. Apparently all the various departments have to spend their entire budget or it will get cut, so they replace everything! I guess that stimulates the economy….

    Have you talked to the First Lady about this? It seems that it completely intersects her efforts to improve nutrition/ eating habits. As a biologist, some of my huge concerns are watershed management, fertilizer run-off.

  • FarmerJane

    I wonder if the Danish dairy farmers were part of the group pushing for repeal of the butter tax? I watched the Danish dairy farmers online last week in the EU farmer protests in Brussels where farmers shut down the city center of Brussels with a 1000 tractor tractorcade, hay burning and milk spraying with farmers from 14 countries participating. And, no wonder they are protesting….I was shocked to see that Bloomberg reported that some 157,000 dairy farms have gone out of business in the EU during the past few years. Denmark has long been known as a country capable of producing great dairy and it has long been part of their food tradition. We are seeing rapid changes in rural EU countries as traditional scale dairy farms are removed from the working landscape. (same as in the US).
    As to environmental impacts of dairy, I think its tough to blanket state that all dairy models are environmentally bad. Food & Nutrition Research (online) had an interesting article called Nutrient Density of Beverages in Relation to Climate Impact conducted in Sweden. The researchers took a look at the nutrient density of various beverages in relation to climate impact. They tried to analyze how the beverage fulfilled Nordic Nutrient Recommendations while looking at its GGEs. Dairy ranked very favorably for the Nordic areas. For Scandinavian natural resources, dairy was a GOOD use of their land. I like the idea of people eating real foods that are the product of good agricultural use of their natural resources. Dairy seems to have been good for Denmark for hundreds of years. Why is it different now?

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  • Stephanie

    I agree that Scandinavians have been living and thriving on animal proteins and fats for hundreds of years. Why are they suddenly adopting American conventional wisdom when it’s done nothing to help the American people? All the data shows that Americans have decreased their intake of animal fats over the last 30 years, while obesity and diabetes continue to climb. Why isn’t it obvious that the most substantial change in the global diet over the last 30-40 years has been the increase of processed oils, processed sugars, and sweetened foods. Look at any restaurant menu from 20 years ago. You would never find sugar, honey, molasses, maple syrup or any sweetener of any kind in a savory dish. Now it is ubiquitous. There is sugar in every dish of every meal. Isn’t that significant?

    But my question is, what are the authors of this tax and their supporters like Marion Nestle proposing that Danish people eat in place of their staple foods? Heavily processed soy milk? margarine? canola oil? fake meat? These foods are all, well… fake, and nutritionally inferior.

  • Stephanie

    One more point: With all due respect to Dr. Nestle and her body of work, I find it disingenuous to engage the public in a forum which encourages debate or conversation with an answer that says, “read my new book.” That is a cheap plug and does not answer her public’s questions.

  • Lars Dahlager

    A note: Denmark already has a high indirect tax on sugar in the shape of a sweets and chocolate tax. The sugar tax was a further addition.

    As a journalist I’ve followed the debate quite closely, and the fat tax didn’t just fall because of industry pressure. In fact very few people liked it.

    The public didn’t want it. Obesity Researchers thought it ill-conceived. Artisan producers hated it because of the large amounts of paper work and bureaucracy involved which invariably favors big coorporations over small businesses.

    The food movements thought it as a threat to real food, as a fat tax favors fat reduced, more artificial products over the real traditional foods that have a lot of traction in Denmark. Economist thought it ineffectual as danes would buy there butter abroad. And the politicians behind the proposals didn’t much like it either, since they mostly had instituted the tax for fiscal reasons.

    It really didn’t stand much of a chance.

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  • http://hvaskaviha.blogspot.dk/ Runejoe

    Numerous opinion polls before and after the introduction of the fat tax in DK reported the Danes saying that they would not stop eating as usual, they would pay the extra money (or buy shop in Sweden or Germany). I guess not every one is like your mother…