France set to slash ‘arrogant Nutella tax’ after protests

French lawmakers have voted to slash a surtax on imported palm oil - dubbed the Nutella tax because the commodity is used in the popular chocolate spread - after protests from top growers Indonesia and Malaysia.

France set to slash 'arrogant Nutella tax' after protests
Photo: AFP

The upper house, under pressure from environmentalists, had earlier approved a tax of €300 per tonne of palm oil, which is blamed for the destruction of huge swathes of rainforest to make way for vast palm tree plantations.

The Senate measure would have raised the tax to €500 in 2018, €700 in 2019 and €900 from 2020, while the lower house schedule would stay at one-tenth of those levels, rising to €90 in 2020.

The surtax is part of a bill on biodiversity that is to return to the Senate for a second reading, but the lower house will have the final say.

Indonesia had decried the Senate's proposed surtax as “arrogant” and “excessive” and a move that could threaten bilateral ties.

The greatly reduced surtax is “more realistic,” said Barbara Pompili, a junior minister responsible for biodiversity issues.

Lawmaker Jean-Louis Bricout of the ruling Socialist Party added that it was out of the question to “suddenly destabilize supplies to companies in France, or the revenue of the producers of these oils, who are mainly in developing countries.”

It was the third time since 2012 that the tax has come up before the parliament.

Environment Minister Segolene Royal last year rankled Ferrero, the Italian company that makes Nutella, by urging people to stop eating the chocolate hazelnut spread, saying it contributes to deforestation.

She had to apologize a few days later for saying that Nutella, which is immensely popular in France, should be made from “other ingredients”.

At 104 euros per tonne, palm oil is among the least taxed edible oils in France, where olive oil for example is taxed at 190 euros a tonne.

While France imports only 150,000 tonnes of palm oil of the total world output of 62 million, Indonesia and Malaysia fear that other consumers may follow its lead if it imposes an exorbitant green surtax.

Socialist lawmaker Anne-Yvonne Le Dain noted the inconsistency of targeting palm oil.

“We import little palm oil, but we import massive amounts of coffee, rubber, chocolate and peanuts” without concern for the deforestation those commodities entail, she said.

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No health risks behind halt on Nutella production, says France

French authorities said Friday that there appeared to be no health risks behind the decision to halt production of Nutella at a plant in Normandy, the world's largest factory making the prized chocolate-and-hazelnut spread.

No health risks behind halt on Nutella production, says France
Photo: AFP
Nutella's Italian owner Ferrero, whose products also include Ferrero Rocher chocolates, on Wednesday said it had suspended production at the site as a precautionary measure.
“As far as I am aware at the moment, there is no health problem,” French Agriculture Minister Didier Guillaume told CNews. “From what I know, this is an economic problem.”
The Villers-Ecalles site in Normandy produces around 600,000 jars a day, or about a quarter of all the Nutella made worldwide.
Photo: AFP
Ferrero's France affiliate said it had discovered a quality defect in one of the ingredients used for making Nutella as well as Kinder Bueno candy bars.
The manufacturer said the defect was not related to its standards of quality.
“For now, we can say no products currently on the market are impacted by the situation and that the supply to our customers continues without interruption,” the company said.
The Ferrero group, with 30,000 employees and 22 production sites around the globe, also makes Kinder surprise eggs and chocolate bars as well as Tic Tac mints.