The Netherlands opts for sugar tax and healthy VAT

The new Dutch government is firmly committed to health and sustainability, and plans to introduce a sugar tax and instead scrap VAT on fruit and vegetables. A label of origin is also part of the agreement.

Cheaper fruit and vegetables

The coalition agreement proposed by the new Dutch government coalition includes some remarkable measures that will impact the retail and food industry. For example, the government will increase taxation on sugary drinks in any case. It is also possible that a sugar tax will be introduced. In addition, the excise duty on tobacco will be increased: the price of a packet of cigarettes will rise from 7.2 euros to 10 euros in the coming years.

In the meantime, fruit and vegetables will become cheaper for consumers: the coalition wants to examine whether the VAT can be reduced from the current 9 % to 0 %. However, this will have to be done in consultation with the European Union, which currently applies a minimum rate of 5 % for these products.

Binding agreements with industry

The government wants to make binding agreements with the industry on healthier food products. The Netherlands Food and Consumer Product Safety Authority will receive a larger budget to carry out its role. Food produced in the Netherlands will be labelled with a label of origin to encourage conscious choices.

Supermarkets must become more transparent about how their entire range is becoming demonstrably sustainable and animal-friendly, including sustainable purchasing behaviour and a fair price for farmers. The agricultural industry must also become more sustainable. The government has allocated a budget of 25 billion euros for the transition to “circular agriculture” and wants a covenant for “animal-friendly livestock farming balanced with public health”.