Estonia, Foodstuff, Legislation, Markets and Companies, Taxation

"Value added tax on food is higher in Estonia already now than in the majority of EU member states. Hence applying tax incentives to influence the consumption habits of citizens would make more sense," the manager of the association, Riin Savi, told BNS on Monday.

Savi said it was difficult to say at this point how much food prices in general would rise if an additional tax was applied to certain food products. "It isn't known today what exactly are the tax policy measures that Minister Ossinovski is having in mind," she said.

"To how big an extent the taxation of so-called unhealthy products would affect the prices of other foodstuffs depends in the end on how these substances or products are defined and how exactly they will be taxed. We actually cannot speak of harmful food, as food safety in Estonia is ensured by means of relevant legal regulation. The problem and harm arises form incorrect consumption of certain goods and products and the amounts consumed," Savi said.

International practice demonstrates that in several countries where additional taxes have been imposed on specific groups of goods for health reasons, such as in Denmark and Finland, the measure has been lifted after some time as strongly undermining the competitiveness of businesses on the export and domestic markets alike. The Estonian Food Industry Association has said imposing a tax on sugar, salt or fats would make all daily foodstuffs – milk products, bread and bakey products – more expensive.

Estonia's Minister of Health and Labor Jevgeni Ossinovski said last week that food taxes and restrictions on the advertising of unhealthy products are considered as one possible part of the green book on nutritional issues that is currently being drawn up at the Ministry of Social Affairs, at the same time these issues are just being analyzed and discussed at the moment and no decisions have been made.

"The discussions regarding the topic are indeed ongoing with different groups. The document is still raw but we definitely want to launch a discussion regarding the issue of the different regulations of harmful foods," Ossinovski told BNS.