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Malaysia slams France’s proposal for ‘Nutella tax’

By RJ Whitehead , 13-Nov-2012
Last updated the 13-Nov-2012 at 12:41 GMT

A French politician’s calls for a “Nutella tax” have been met with anger in Malaysia. Central to the terms of the proposal, which will be voted on in Paris this week, lies a 300% duty increase on palm oil imports to the country.

The Malaysian Palm Oil Council (MPOC) slammed Senator Yves Daudigny’s idea as part of an aggressive and unprovoked attack against palm oil, and branded any move to bring it to legislation as “irresponsible” and “badly informed”.

The social commission of France's upper house had adopted a proposal last week for a tax of EUR300 per tonne of palm, coconut and palm kernel oil used in human food, on top of existing taxes of around EUR100. This would also apply to imported food products.

Lobby refutes claims

Dr Yusof Basiron, MPOC’s chief executive, said that the proposal was based on inaccurate claims that palm oil is bad for health and nutrition, and that Malaysia does not respect the environment.

"Contrary to Senator Daudigny's comments, every nutritional and food expert concludes that palm oil is in fact free of dangerous trans fats, free of GMOs and contains valuable vitamins,” continued Basiron. 

He even cited a study that found that replacing palm oil would be a bad option for French consumers as it would potentially lead to a rise in the level of trans-fat consumption in the country. 

The tax is so named because palm oil is present as the primary ingredient in Nutella, France’s favourite chocolate hazelnut spread, as well as pastries and other processed foods. It is estimated that the French on average consume 2kg of palm oil a year—equating to a market of over 125,000 tonnes.

The proposed tax would translate to an EUR0.06 increase per kilo of Nutella.

Loss of livelihood

Over 240,000 small farmers across Malaysia depend on palm oil for their livelihood. In addition to this, many thousands of other jobs in Malaysia depend upon related industries.

Senator Daudigny's actions jeopardise the livelihood of these farmers,” continued Basiron. “We call upon the French government to reject the proposal—it is part of an aggressive and unprovoked attack against palm oil.”

He added that Daudigny’s motion would significantly undermine the competitiveness of the French food industry, domestically and globally.

Last week, French food makers denounced the proposed tax, saying that palm oil should be banned, not taxed, if it was indeed damaging to health.

"Palm oil as such is not bad for health," Jean-Rene Buisson, head of France's Ania food industry association, said. "Punitive acts such as raising a tax by 300% to push industrials to use something else is absolutely scandalous," he said.

The use of palm oil is increasingly being met with suspicion in France and other parts of the world due to the industry’s alleged links with deforestation and ill health. Several leading retailers in France have recently promised to ban or cut the vegetable oil, or switch to sustainable sources.

Editor's note: Essential and sustainable, or dangerous and bad for the environment? Let us know your views on palm oil in the comments below.

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