John Wagner proposes a tax-free trial period for organic products

After several of the Folketing's blue parties have criticized the government's plans for a partially tax-funded VAT reduction in recent days, John Wagner warns, according to FødevareWatch, politicians against completely dropping the reduction. The government's proposal to exempt fruit and vegetables from VAT and halve the VAT on other foods will cost the state treasury 17.4 billion DKK annually and will only come into effect from 2028, as authorities first need to develop a new IT system capable of handling differentiated VAT. According to Jyllands-Posten, this is the most expensive point in the entire government platform. For this reason, the government's plans to finance a large part of the planned VAT reduction through the tax ticket now face opposition in the corridors of Christiansborg. At the same time, John Wagner describes it as a blatant breach of election promises if the VAT reduction ends up being dropped, as happened previously with the chocolate tax. According to FødevareWatch, the former director of De Samvirkede Købmænd therefore suggests that the government choose a cheaper plan B, where they test the effect of a VAT reduction on organic and keyhole-labeled products during a trial period. "I think they should start with a five-year experiment, where they remove VAT on organic products and keyhole-labeled products. If they do that, it is very easy to manage because there are already control schemes for organic and keyhole-labeled products, so there is no need to create new systems," says John Wagner to FødevareWatch. When the test period ends, he believes politicians will have a much better basis for assessing how best to work with differentiated VAT, especially when comparing the effect with the political goal of doubling the organic area.