Who needs a diet when there are taxes?

Recently we mentioned that the fight against obesity is moving to the top of the political agenda of the Member States. Aside new rules on labelling (How to get consumers to eat healthier?), which aim to allow consumers to make more conscious choices (hopefully healthier), there are more political debates as well as attempts to regulate the food market. UK medical circles increasingly argue for food taxation to be introduced (The fight against obesity: To tax or not to tax?). Ireland introduced a 'soda tax' following on the French example. However, other news (The 'nanny state' in consumer health needs to go) report on the failed experiment with a 'fat tax' in Denmark. This tax was repealed within 15 months from its introduction due to no reported beneficial impact on consumer health, but rather noticed trend of lower income consumers switching to cheaper and potentially even more rich in fat food. It is not easy - trying to get consumers to make all the 'right' choices - but it is encouraging to see that various policymakers are trying various methods to improve consumer wellbeing. From the research perspective - the comparison of the different policies adopted by various Member States may provide the winner, i.e. the most effective policy measure in this area.

Tax increase on consumer goods - an effective nudging tool?

There is an interesting article in today's The Guardian by P. Barkham on how the introduction of a 5p charge for plastic bags last year in the UK has led to significant changes in consumer purchasing behaviours and ultimately contributed to better environment protection (Six billion plastic bags can't be wrong - so what do we tax next?). Logically, you wouldn't think that just the fact that consumers were faced with having a choice of paying less for their groceries if they brought their own bags, would lead to significant behavioural changes, considering the diminutive amount of the price increase. But still... of course, just the fact of having to confirm this additional charge might have been discouraging, as well as could have brought consumers' attention to the reason behind this sudden charge - environmental protection. The author poses a valid question whether tax policy is where we may expect more nudges to occur in the future.

E-books possibly more expensive in the future for certain European consumers

Today, the ECJ decided that the rules in place in France and Luxemburg, that established a strongly reduced VAT for e-books, are in breach of EU law.

VAT rules are indeed harmonised in the EU by virtue of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax and its implementing regulation. These rules explicitly prohibit levying a reduced VAT on services provided through electronic means, and the Court has considered that e-books are indeed services and not goods. 

Member States are however not prevented from keeping lower VAT in place as far as physical books are concerned. The latter are to be considered goods, as it is impossible to imagine their transmission without a physical support (ie paper). 

Italy has also recently lowered the VAT on e-books, after pressing campaigns focussing on the need to promote readership irrespective of the "infrastructure". The Kingdom of Belgium had intervened in both proceedings to support the "non-compliant" Member State's position.

The decision might entail a price increase for e-books, unless publishers decide, at least for some time, to give in part of their share in order not to discourage e-readers.

The shop around the corner - CJEU judgment in Case C-315/12 Metro Cash & Carry

Today, the Court of Justice of the EU delivered several judgments relating to consumer goods. A first one, Metro Cash & Carry, concerns the cross-border sale of alcoholic beverages to Swedish consumers in a Danish supermarket. Since Danish excise duties on spirits are considerably lower than Swedish ones, and consumers are not subject to Swedish duties when acquiring products in Denmark, there is a strong incentive for Swedish consumers to buy these alcoholic drinks in the Danish shop and import them into their home country. The CJEU was presented with the question of whether this practice is in compliance with EU law.

The Court holds that the relevant measures of EU law must be interpreted as meaning that a trader 'is not required to check whether purchasers from other Member States intend to import products subject to excise duty into another Member State and, where relevant, whether such importation is for private or commercial use'.