Herz Salami Poster 1900

Food Tax Experiments

Hungary is in the midst of a food tax experiment to shape healthier diets and blunt the impact of obesity with the chronic diseases it brings.  France, Finland, Denmark, Britain, Ireland, and Romania have either tried food taxes or considered them. But right now, Hungary stands out for a particularly ambitious effort.

In the last two years, Hungary has taxed salt, sugar, and some energy drink ingredients. The initiative was first labeled a “hamburger tax” and it was to include taxes on fast food. But it quickly morphed into a “chips tax,” dropped the issue of targeting fat, and applied only to packaged foods — all for pragmatic reasons.

Hungary has a lot at stake. Compared to the rest of the European Union, it ranks near the bottom for life expectancy: 71 years for men and 79 years for women. By comparison, the EU average is 77 years for men and 83 years for women. “We have a public health crisis,” says Miklos Szocska, Hungarian health minister. “We are leading the charts in many kinds of diseases. So, those who follow a certain lifestyle should pay for it in a small way.”

Skeptical Hungarians call the food tax “a joke.” Though salty and sugary food sales are down, tough economic conditions make the big picture unclear. People are having a tough time affording all kinds of food. The taxes came at a time when the Hungarian government had a big budget gap to fill, so many Hungarians shrug it off as a cynical ploy to raise money for the government.

Especially skeptical is the Hungarian food industry. “The industry was shocked,” said Reka Szollosi, of Hungary’s Association of Food Producers. “There was practically no consultation before they decided on these taxes. And taking salt out of a product can have serious technical consequences. In many cases, it serves as a preservative. People are not aware,” she said, of all the salt in their diet. “So, now they are saying to themselves, ‘Okay, I don’t eat chips, I’m okay,’ and that just isn’t true.”

The experience in Denmark is a daunting precedent. A progressive effort to tax fatty foods went down in flames after less than a year last fall. Such experience leads many to conclude that heavy-handed government regulation and taxation schemes will not work and a close collaborative approach with the food industry is required.

Others, like Marion Nestle of NYU, are very clear that the food industry has hijacked nutrition to the detriment of public health and expect nothing different from the industry in the future. The Academy of Medical Royal Colleges recently called for an vigorous regulatory approach to save the UK from an obesity problem that is spiraling out of control into the single greatest public health crisis facing Britain.

Because everyone has a stake in food policy, sweeping changes will continue to face tough going with a skeptical public. Increments of progress are more likely to endure if we can document the benefits.

Click here to read more in the New York Times, here to read more in the Washington Post, and here to read more in the Telegraph.

Herz Salami Poster 1900, image from Wikimedia

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