Supermarkets want VAT removed from organic food

Removing VAT would make more people buy organic, but government says the proposal is against EU law

“I can confirm that the dispute concerns the right to produce rectangular chips,” says Kims' CEO (photo: Kims' official website)
January 27th, 2014 4:27 pm| by admin
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Buying organic pork chops from healthy and happy pigs would be a lot more popular if they were cheaper.

One way to make organic food more attractive for consumers would be to get rid of the value-added tax (VAT, or moms, in Danish) on the products, says John Wagner, head of the national grocer's association, De Samvirkende Købmænd (DSK). 

"When a costumer at the refrigerated counter sees that an organic pork chop costs twice as much as a regular pork chop, that is a terrifying difference," Wagner told DR Nyheder. "We would love to sell more products that are healthy for both people and animals. That's a natural part of our responsibility as a society."

DSK represents 1250 supermarket stores like Rema 1000, Spar, SuperBest and the convenience store 7-Eleven.

Would be illegal state aid
But it would be against EU law to remove VAT on organic food products, according to Christian Friis Bach, Radikale's food and agriculture spokesperson.

"You cannot, may not and should not remove VAT on specific products to increase sales," Bach told DR Nyheder. "It could quickly become a slippery slope and it's even against EU regulations."

According to Bach, the EU would perceive it as illegal state aid if the government removed VAT on organic food, because it would favour the sale of some products over others.

READ MORE: Farmers giving up organic milk

Nevertheless, Bach agreed with the supermarkets that more should be done to boost sales and consumers' willingness to buy organic food.

"We have to do more to increase organic pork production and we are doing that by making more research and investments," he said.

The supermarkets joined the debate on organic food production after DR1 on Thursday aired the documentary 'Det store svinerige' (The great pork kingdom) revealing horrid living conditions of commercial pigs and illegal production methods at some of the nation's slaughterhouses.

“I can confirm that the dispute concerns the right to produce rectangular chips,” says Kims' CEO (photo: Kims' official website)
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