Citing a harmful effect on businesses and consumer buying power, lawmakers in Denmark have repealed the so-called fat tax, which was charged on foods high in saturated fats, after just one year.

In a related decision, the Danish tax ministry said it was canceling plans for a sugar tax. “The fat tax is one of the most criticized we had in a long time,” Mette Gjerskov, minister of food, agriculture and fisheries, said on Saturday during a news conference in Copenhagen, the day the repeal was announced.

“Now we have to try to improve public health by other means.”

The Danish decisions to end taxes aimed at curbing obesity point up the challenges that politicians face in grappling with what has become a major public health issue. The moves were announced just a few days after voters in California defeated ballot measures that would have imposed taxes on sugary drinks.

“I’m not surprised they had trouble with a fat tax,” said Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest, a nonprofit advocacy group based in Washington that has worked on food tax initiatives.

“It’s much easier to tax specific foods, say a tax on sugary sodas, than to tax at the nutrient level like a fat tax or a sugar tax.”

The Danish law put a surcharge on foods containing more than 2.3 percent fat.

When it came to the fat tax, retailers complained that Danes simply went to Sweden and Germany, where prices are lower, to buy butter and ice cream.

Still, the tax raised $216 million in new revenue. To offset the loss of that money, the Legislature plans a small increase in income taxes and the elimination of some deductions.

Article source: http://www.nytimes.com/2012/11/13/business/global/fat-tax-in-denmark-is-repealed-after-criticism.html?partner=rss&emc=rss