I recall many years ago when I was studying for my accounting exams. One of the things we learned about Irish valued added tax (VAT) is that the rate of zero tended to apply to basic foods – milk, bread, for example – with higher rates generally applying to more “luxury” items.
Having had a recent article in the Guardian, it made me think about whether VAT would be a good way to increase taxes on unhealthy foods like sugar – unhealthy in that there tends to be too much in certain processed foods. It seems logical and sensible, and in the article, even a large food company is asking for such change. It is also quite efficient as the VAT system is well established in most European countries, so no need to create a new system to administer a new tax.
