Denmark Taxes Butter And Fat, But Will It Work?

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Denmark, the land of luscious lardy pork ribs and those famous blue butter cookie tins, is not known for having a major obesity problem. In fact, Danes are among the thinnest people in Europe and beyond. (Most obese? Us. About one-third of us. Us — as in people of the U.S.)

So when the tiny Scandinavian country announced it would be imposing a 16 Kroner (about $3 U.S.) tax on every kilogram of saturated fat as a way to discourage poor eating habits and raise revenue, we were left scratching our heads.

How's that going to work?

Ole Linnet Juul, food director at Denmark's Confederation of Industries, tells The Washington Post that the tax will increase the price of a burger by around $0.15 and raise the price of a small package of butter by around $0.40.

Our pals over at Planet Money took a stab last year at explaining the economics of our version of the fat tax — the soda tax. They conclude that price increases do drive down demand somewhat.

But couldn't Danes just easily sneak over to neighboring Sweden for butter and oil and simply avoid paying the tax, throwing all revenue calculations off?

Meanwhile, some health studies indicate a soda tax doesn't work to curb obesity anyways.

Other, fatter countries are watching Denmark's fat tax move closely. Take the UK, which weighs in at third-most obese, behind us and Mexico.

Tam Fry of the National Obesity Forum tells The Guardian: "It is not a question of whether we should follow the Danes' lead – we have to. If we don't do anything about it, by 2050, 70 percent of the British population will be obese or overweight," he says.

Tune in a little later today when All Things Considered Host Guy Raz talks with Danish business reporter Jakob Sorgenfri Kjaer of the newspaper Politiken about his country's reaction to the new law.

Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/.

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