Friday, February 12, 2010

Row in Romania over bid to impose major junk food tax

By Mihaela Rodina (AFP)

BUCHAREST — While First Lady Michelle Obama launched a high-profile campaign against obesity in the US this week, small Romania may be a step ahead with its bid to impose one of the first comprehensive taxes on junk food.

The government proposal, still in the works despite hopes it could start next month, has triggered groans from the food industry and skepticism about its efficacy.

But the health ministry is not backing down on a measure aimed at changing habits it says have left an alarming one in two Romanians overweight, while outright obesity doubled in only two years.

"We can't just stand around doing nothing," said Secretary of State with the Health Ministry Adrian Streinu-Cercel during a public debate.

"We have to re-educate Romanians on how to feed themselves properly."

Not an easy task in a country with a long tradition of heavy meals and fatty trimmings.

Add to this an influx of calorie-laden fast food, a tantalizing hit in a former communist state struggling to keep up with its European Union partners. McDonalds, for one, is hugely popular and "by far the leading player" in fast food sales in Romania, according to the Euromonitor research firm.

Since it was proposed in January, the tax has whipped up roaring debate on special TV talk shows, full-page newspaper articles, cafe discussions and several press conferences by both the pros and the cons.

"Romanians eat badly because they are poor," insisted Dragos Frumosu, head of the industrial food producers union.

Taxing hamburgers, chips or pastries will only push people towards cheaper options, "even less healthy and produced in unsanitary conditions", he said.

The March 1 goal to start taxing is seen as unlikely. A list of "guilty" foods must still be drawn up and approved by the government then put to a parliamentary vote.

But if the bill goes through and "what the health ministry has said is to be believed, it would be the widest-ranging singular tax of this kind," said Oxford scientist Dushy Clarke, a researcher specialised in the impact of health-related taxes and food subsidies.

Though "junk food" taxes exist elsewhere, Clarke said they generally concern chocolate, foods and drinks high in sugar and some saturated fats, as in Denmark. Romania's proposal would also take in foods high in grease, fat, salt and some additives.

In addition, "this tax would be the first of its kind to go straight to producers and importers of junk food," said Clarke.

Taiwan is also considering a comprehensive junk food tax, which is expected to be submitted to parliament later this year and could take effect in 2011 at the earliest. France made a tentative bid, but shelved the idea in 2008.

And while most US states do have soft drink or junk food taxes, experts say they are usually too low to have an effect on consumption. The latest US initiative focuses more on raising awareness and offering healthy choices.

Yet the World Health Organization's 2004 Global Strategy on Diet, Physical Activity and Health suggests that "member states consider fiscal initiatives and policies via taxation, subsidies or direct pricing in ways that encourage healthy eating..."

Bucharest hopes the tax will raise one billion euros (1.3 billion dollars) a year as well trim corpulence, which carries health risks and drives up a nation's medical costs.

Romanian youngsters, as in the US and elsewhere, are notably at risk. Though outright obesity only affects 3.5 percent of children here aged three to nine, this is a twofold increase in only four years, the ministry noted.

Businessmen do not contest the problem, just the government's proposed solution.

They say Romania already has too many taxes and accuse the ministry of launching the idea without consulting business or union leaders or drawing up a list of products first.

Mihai Visan, head of Romalimenta, an association of food sector professionals, voiced concern about the "social and economic impact" of a junk food tax, which he said would penalise consumers.

After last year's severe recession, he said, producers will make up for any tax by raising prices -- at a time when unions say prices already increased by 20 percent.

Food experts say some earlier experiments turned afoul, including one "sin tax" that took 375 million euros out of the budget after consumers turned to the black market for cheaper alcoholic drinks.

Punitive measures may also turn popular foods into "forbidden fruits", Gheorghe Mencinicopschi, director of the Research Nutrition Institute here, told AFP.

"All restrictive measures can have the opposite effect if they are not accompanied by an education campaign," he said, referring to Romania's ban on fizzy drinks and snack foods in schools.

"The kids just cross the road and buy the same things in the shops before school starts, or take it out of their fridge at home because parents are still buying the stuff."

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