France Approves Tax on Palm Oil

March 19, 2016 Taxation in France

PARIS – France will soon tax imports of palm oil at EUR 30 per tone, despite internal claims that such a tax is illegal and perpetuates poverty.

On March 17th the National Assembly of France approved the proposal to implement a tax on importation of palm oil to be used as an additive to food.

The new tax will come into force in 2017 and will be set at a rate of EUR 30 per tonne, rising by an additional EUR 20 per year, to be capped in 2020 to a rate of EUR 90 per tonne.

The tax will not apply to imported palm oils which are produced in an environmentally sustainable way.

The proposal to implement a tax on palm oil has been raised several times since 2012, although the original proposals called for the rate of the tax to be set at EUR 300 per tonne.

The new tax is already facing significant oppositions, especially from economic groups and researchers in countries relying on palm oil exports, as they claim that the new tax is discriminatory and will only hurt palm oil producers, without providing any tangible environmental benefits.

Industry groups in Nigeria, Malaysia, and Indonesia have already gone so far as to claim that the tax breaks trade laws set out by the World Trade Organization, and undermines France’s commitment to the United Nation’s Millennium Development Goals.

Photo By: Håkan Dahlström