With the aim of improving the health of the Danish population, the Danish government has implemented a controversial fat tax on food products. The tax applies to food products high in saturated fat and affects dairy products, vegetable oils and meat.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
GAIN Report Number: DK1103
Danish Fat Tax on Food
Trade Policy Monitoring
Dairy and Products
Mary Ellen Smith
With the aim of improving the health of the Danish population, the Danish government has
implemented a controversial fat tax on food products. The tax applies to food products high in
saturated fat and affects dairy products, vegetable oils and meat.
On October 1, 2011, the Danish government implemented a tax on food high in saturated fat. Products
affected by the tax include meat, cheese, butter and vegetable oils  . The tax is the first of its kind in
the EU and was imposed to help Danish consumers make better and healthier food choices. For the
same reason, Denmark imposed similar health related taxes on confectionary and soft drinks between
2008 and 2010.
The fat tax rate is DKK 16 per kg saturated fat and applies to domestic and imported food products with
a saturated fat content exceeding 2.3%. The expected cost for Danish food producers and importers is
about DKK 1 billion (USD 180 million) per year. The tax will be collected by the processors and
importers, not the retail sector. Expected increases in food prices will vary depending on the food
category, please see table below.
Food Product Saturated fat per Price (DKK) New Price Price Increase
100 gr Before (DKK) (%)
Butter, 250 g 51.8 15.50 18.1 16.7
Cheese 45+, 500 16.7 34.40 36.1 4.9
Rapeseed Oil, 1 6.4 9.95 11.03 10.9
Pork, 500 g 6.5 19.95 20.96 5.1
Beef, 1,000 g 5.2 199.88 200.9 0.5
Source: The Danish Ministry of Taxation
Danish Food Industry Critical
The tax has predictably been heavily criticized by the Danish food industry, which claims that it will
harm productivity and imports. Danish exports will, however, not be affected by the tax as it only
applies to products consumed in Denmark. The food industry fears that the tax will encourage Danes to
travel across the border to Germany and Sweden to shop. In addition, it questions whether it will
actually lead to healthier eating as the tax might encourage the use of food additives to replace the
saturated fats. The Danish government believes that consumer patterns will indeed change and
estimates that saturated fat consumption will be reduced by 4%.
Implications on Trade
As mentioned above, the obligation to pay the financial levy lies with the importer. The importer needs
to be registered with the Danish Customs and Tax Administration. Registration is to take place before
transport of the food from the foreign country has begun. The new tax is also an extra burden for
exporters as they will have to calculate the saturated fat content included in their products in order for
the Danish importer to pay the tax. Also, they will need to take the tax cost into consideration when
setting the price.
It is hard to predict if the new tax will have any implications on import volumes of the affected products
to Denmark. Products with relatively low saturated fat content, such as meat, will obviously be less
affected. The competitiveness of cheaper imported products might, however, be reduced since the tax is
based on volume, not price. U.S. exports of products that are most affected by the tax (butter, edible
oils and pork fat) to Denmark are rather limited. In 2010, U.S. exports of butter to Denmark were
valued at USD 6 million while exports of edible oils and pork fat were virtually none.
 Products subject to taxation:
Dairy products under HS codes 0401-0406
Animal fat which are melted out or are extracted in other ways that are under HS codes 1501-1504 and 1516
Edible oils and fat under HS codes 1507-1516
Margarine and other food under HS codes 1517
Spreadable blended spreads under HS codes 2106
HS codes are not used for meat products. Meat from cattle, swine, sheep, goat, horse and poultry is taxed based on the meat
content and the average standards of saturated fat in the individual species.
Other food which, based on an overall evaluation of the nature of the food, its use and the way it is marketed, can be
considered to be a substitute for or imitation of the goods specified above.