France divides opinion with palm oil tax hike
“The proposed tax is based on the flimsy grounds that palm oil is under-taxed in France. This is false,” said Yusof Basiron, chief executive of the Malaysian Palm Oil Council.
“This action clearly undermines the national development goals of developing countries. The differential tax proposal is a clear violation of both World Trade Organisation and European Union rules.”
Part of a wider biodiversity bill, the tax starts at €30 in 2017 and rises €20 a year to €90 in 2020. France had originally planned a €90 flat rate tax. The new levy adds to an existing tax of €104 a tonne, but this is still far less than its original €300 proposal.
“The introduction into France’s fiscal legislation of a tax on products whose impact on deforestation is recognised worldwide, gives a strong signal by France in terms of environmental protection,” Barbara Pompili, junior minister for the environment in charge of biodiversity, told France’s national assembly.
However, France has been criticised by environmentalists for softening its stance on palm oil. Widely used in soap, lipstick, biodiesel and products like noodles, chocolate and cooking oil, global palm oil production has increased five-fold since 1990.
Environmental protection groups argue that this western demand for palm oil led to the destruction of one third of the peat-swamp forests in Malaysia between 2005 and 2010, which were cleared to make way for palm oil plantations.
