` France Cuts Proposed Tax Hike on Palm Oil

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France Cuts Proposed Tax Hike on Palm Oil

Mar. 22, 2016
By Alice Alech

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In Jan­u­ary, the French Sen­ate voted to apply what has been called a bio­di­ver­sity sur­tax on imports of crude palm oil. Pres­sure from envi­ron­men­tal­ists con­cerned about huge areas of rain forests being turned into palm oil plan­ta­tions caused mem­bers to approve the pro­gres­sive import tax. Had it been passed it would have raised taxes from €100 per ton to €300 ($326) in 2017, €500 in 2018, €700 in 2019 and €900 in 2020.

Indone­sia and Malaysia, the main exporters of palm oil to France, described the tax as unfair. In Kuala Lumpur, the Malaysian Palm Oil Coun­cil (MPOC) said the French imposed a dis­crim­i­na­tory tax on one of the devel­op­ing world’s key exports. The tax has been passed by a vote of MPs in the National Assem­bly, despite hav­ing no eco­nomic or envi­ron­men­tal cred­i­bil­ity,” it said in a state­ment.

The two coun­tries joined efforts to suc­cess­fully lobby France, and this week the National Assem­bly approved the levy of a grad­ual sur­tax start­ing at only €30 euros ($34) in 2017 on top of the exist­ing €104 exist­ing levy.

The new reduced levy is set to increase by €20 per year to €90 by 2020, just one-tenth of the first sur­tax levy.

Palm oil is high in sat­u­rated fats but much less taxed than other oils such as olive oil which is taxed at €190. The French con­sume approx­i­mately 126,000 tons of this rel­a­tively cheap com­mod­ity in an array of food prod­ucts.

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This is the third time since 2012 that palm oil has come up for review in par­lia­ment. Trig­ger­ing strong reac­tion in France was a story involv­ing French Ecol­ogy Min­is­ter Ségolène Royal who in July 2015 said she would like to see French peo­ple stop eat­ing Nutella because the prod­uct was destroy­ing the planet, warn­ing cit­i­zens that they should be more vig­i­lant about envi­ron­men­tal issues.

She was refer­ring to the Ital­ian prod­uct that the French love — a hazel­nut spread French chil­dren have on bread for break­fast or their after school snacks. Nutella is 17 per­cent palm oil and 55 per­cent sugar — not entirely healthy — yet it seduces 26 per­cent of French peo­ple. Royal pointed to the masses of trees that had to be replanted because of defor­esta­tion which leads to cli­mate change.

Past pro­pos­als on tax regard­ing palm oils were dubbed by the French media as the Nutella Tax because of the enor­mous pop­u­lar­ity of the hazel­nut spread.

On hear­ing about Royal’s remark, The Ital­ian Envi­ron­ment Min­is­ter said she should leave Ital­ian prod­ucts alone.” When Fer­rero, the com­pany that makes Nutella, refuted her com­ments say­ing that it used sus­tain­ably sourced palm oil, the min­is­ter tweeted on her offi­cial account A thou­sand apolo­gies for the row over Nutella.”

The war on palm oil con­tin­ues as Green­peace pro­test­ers took action against Bol­loré head­quar­ters in the north of France in Feb­ru­ary. Bol­loré is a share­holder in a Bel­gium com­pany that man­ages palm oil and rub­ber in Asia and Africa. The 100-square-meter ban­ner dis­played by pro­test­ers read Bol­loré, hard affairs not kind to the forests.”



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