The Ministry of Finance: excise duty on palm oil may affect all the products with its contents

MOSCOW, February 9. The excise tax on palm oil could affect all food products in the production of which it is used, including chips, said the representative of the Ministry of Finance.

The Ministry of Finance, industry, agriculture and health endorsed the introduction of excise duty on palm oil, which will improve power quality and increase budget revenues. The discussion of such initiatives is being held in the government.

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Rate of excise duty on palm oil will be calculated by the Ministry of Finance in rubles per ton

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The Ministry of health of the Russian Federation: the experience of other countries to increase tax on “harmful” food positive

“From our point of view, taxes on products, consumption of which in large quantities is harmful to health is justified and may be imposed in Russia, especially during a difficult situation with the budget. This should be done not only to replenish the budget, but in order to affect reduction of consumption of economic methods and not by prohibitions and limitations (especially as it very often is not about tobacco and alcohol, but of the products of mass consumption)… Palm oil is used for manufacturing and not very useful food products such as potato and other chips,” – said the representative of the Ministry of Finance.

He noted that “there is another problem specific to the food industry, where low cost of palm oil relative to other vegetable and animal fats provokes its use to reduce the cost of products and deceiving consumers who believe that buying goods using, for example, of butter”. “Dangerous this situation becomes, when instead of edible palm oil used technical, with low melting points. Its intake in food is dangerous to person,” he said.

Palm oil is often used by dairy producers and bakers to reduce the cost of production. This oil is made from the fruit of the oil palm. According to Rosstat, the supply of palm oil to Russia for the first 9 months of 2015 increased by 31.7% compared to the same period in 2014. The Ministry of health first made a proposal to introduce excise duties on a range of products with a high content of fat and sugar.

Earlier it was reported that the Finance Ministry is considering the option of specific excise rate in roubles per ton of palm oil. Also the Finance Ministry is considering additional taxation of beverages with high sugar content and chemical essences. Such measures are recommended by who, including for the purpose of combating excessive consumption of sugar and related diseases.