Germany's confectionery industry has sided with the federal government in a clash between the ruling parties in the country’s grand coalition, over whether to impose stiffer taxes on sugar to boost public health.
A proposal to raise the reduced VAT rate of 7% on confectionery and other sugar-based products to the standard VAT rate of 19% has been made by Elvira Drobinksi-Weiß, the consumer protection spokeswoman for the Social Democrat Party (SPD). She says the move could help tackle obesity.
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But Germany's agriculture and nutrition minister Christian Schmidt has opposed the plan saying that "penalty taxes do not usually change people's eating habits". Herr Schmidt is a member of Chancellor Angela Merkel's Christian Democratic Union (CDU), the coalition’s senior member. A spokesman for Schmidt told just-food its policy was to provide "extensive consumer information and on developing and expanding the educational and guidance measures that are available".
A spokesperson for German Sweets, (the German Association for the Promotion of Chocolate, Confectionery, Biscuit, Snack and Ice-cream Exports) said the proposed tax increase would hit families and "would not cut sugar consumption", noting that a similar tax in Denmark focusing on fats was withdrawn last year after being found ineffective.
German Sweets said there were many factors causing obesity and singling out the sugar confectionery industry for blame was "not appropriate".
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By GlobalData
