The Danes and the Swizz

Denmark has officially repealed its so-called “fat tax” after being on the books for only one year.  Also, the Danish tax ministry has announced that it no longer plans to move forward with a sugar tax.  In the final analysis, butter, ice-cream, and pastries are just too good to allow some pesky tax to modify a whole country’s eating habits.  Some believe that Denmark would have had more success had it been more focused in its efforts to improve public health through taxation of targeted foods.  However, if the failed soda tax in some parts of the United States is any indication, a tax on specific foods might not be popular either.

In other news…

Kasseem Dean, a.k.a. Swizz Beatz, may or may not owe millions of dollars in back taxes.  Many media sources have him owing the state of New York $100,000 (an amount that Dean suggests is equivalent to the cost of a flight from Los Angeles to New York — I assume he’s not prone to flying coach). Those same sources report that he is also burdened with a $2.6 million IRS tax problem. But Dean, in a barrage of double negatives vehemently denies he owes any taxes.  Celebrity tax issues are usually publicized after the IRS files a tax lien and in that regard are, at least in part, based on fact.  Most likely what Dean means is he is disputing the assessment, which he has every right to do.

Denmark's "Fat Tax" is Losing Support


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I was sad to learn that the Danish government is second guessing the “fat tax” that just made it on the books last October.  They are finding that Danes are crossing the border for tax relief.  They are crossing into neighboring countries (Germany, Holland, or Sweden) to make their high-fat food purchases, which is causing serious financial harm to Danish businesses.  I guess this means the Danes won’t be taxing foods with high sugar content either as they had planned to do previously.  They had such high hopes only a year ago.

The issue of whether or not “sin taxes” produce the desired effect is a hot one; experts do not agree.  Denmark certainly would have been an interesting test case.  But repealing the fat tax after only one year isn’t going to tell us anything definitive.  I won’t lie, it was also kind of nice that we were able to observe how this might have played out from a distance (without subjecting ourselves to such an awful tax).  The tax attorneys at our firm are united in our steadfast opposition to any tax that would make junk food more expensive.

Denmark’s “Fat Tax”

It’s bad enough that the tastiest foods are always so bad for you, now in Denmark they are getting more expensive too.

Beginning October 1st Denmark initiated it’s new “fat tax,” which increases the price of certain foods by 16 krone (about $3) per kilo of saturated fat. It is expected to have a substantial impact on the price of everyday staples such as milk, cheese, bacon, and butter. The Danish (the people and the pastry) are not thrilled. These traditional goodies are said to be made with generous amounts of butter:

Although the government approved the tax by an overwhelming majority, the people of Denmark and others have made the following arguments in opposition to the tax:

  1. Negative impact on organic dairy farmers
  2. No distinction in the law between fat in whole foods, processed foods, or even fast food
  3. The government passed the tax to increase revenue, not to improve the health of the Danish
  4. May have unintended consequence of driving people to purchase cheaper, less healthful foods
  5. A fat tax should focus on cutting trans fats, not saturated fats
  6. Many people will still eat the same things they ate before the tax
I guess the upside is that tax relief and weight relief will now come in the same package.