Summary
This integrated economic, health and environmental modelling study demonstrates that reforming value-added tax rates on foods—specifically reducing VAT on fruits and vegetables whilst increasing rates on meat and dairy—can simultaneously improve population diets and deliver health, environmental and economic benefits across most European countries. Health gains were primarily driven by reduced VAT on produce, whilst environmental and revenue benefits predominantly resulted from increased rates on animal products. The findings suggest that fiscal policy differentiation based on health and environmental considerations is a viable policy tool for dietary transition in Europe.
UK applicability
The UK operates a complex VAT system on foods (zero-rated on most fresh produce and staple foods, standard rate on some processed items) that differs from continental European structures. However, the study's methodology and findings on the effectiveness of tax differentiation could inform UK policy review, particularly regarding reduced-rate items and potential extension of VAT exemptions to support dietary shift towards plant-based foods and away from high-impact animal products.
Key measures
Dietary changes, health improvements, greenhouse gas emissions reductions, land use changes, and fiscal revenue impacts across European countries
Outcomes reported
The study modelled the effects of reforming VAT rates on foods across European countries, measuring impacts on dietary composition, health outcomes, environmental metrics (greenhouse gas emissions and land use), and economic/revenue effects.
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