IRELAND: Irish food makers slam fat tax proposal
The government is reportedly hoping the levy will reduce the number of overweight people in Ireland
The Irish food and drink industry has hit out at reported plans from the country's government to introduce a tax on unhealthy foods.
Food and Drink Industry Ireland (FDII) has warned imposing a discriminatory tax on certain food and drink products would have "no health benefits and would only serve to further hit already hard-pressed consumers".
FDII made the comments in response to the Irish government reportedly considering to introduce a tax on high-fat foods sugary drinks.
The government is reportedly hoping the levy will reduce the number of overweight people in Ireland and generate some much needed revenue for the exchequer.
According to Ireland's Department of Health, 39% of adults are overweight and 18% are obese at the present time in Ireland. This, the department suggests, could be costing the state as much as EUR4bn per year.
Commenting on the proposal, FDII director Paul Kelly, however, said extra taxes or other forms of discriminatory legislation targeting individual food categories will "simply damage competitiveness".
"Ireland already imposes high taxes on many foods. While most foods are exempt from VAT, the standard rate of 23% applies to confectionery items like sweets, chocolate, crisps, ice-cream and soft drinks. An additional tax on sugar or soft drinks, for example, would amount to a double taxation and cause unwelcome uncertainty throughout the food chain," Kelly said.
"Any new taxes would be highly regressive and hit the poorest hardest as low-income families spend a higher proportion of income on food. We would run the risk of re-igniting cross-border shopping which would in turn damage the domestic economy and reduce the government's tax take."
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