Tug-of-war in coalition

Babler’s food list is too vegetarian for the ÖVP

"For me, meat is a staple food," says Minister Totschnig.(Bild: Krone KREATIV/Eva Manhart)

While Germany is discussing an increase in VAT on meat in the interests of climate protection, the debate here is moving in the opposite direction: the ÖVP considers the list of staple foods on which taxation is to be reduced too vegetarian and is calling for meat to be included.

Exactly one week ago, SPÖ leader and Vice-Chancellor Andreas Babler presented the list of staple foods for which VAT is to be reduced from ten to less than five percent. It included milk, dairy products, chicken eggs, fruit and vegetables, as well as grains, milled products, and baked goods.

The relief package is worth €400 million and is to be financed by a levy on non-recyclable plastic for companies and a levy on parcels from non-EU countries – primarily China. This means that the government's room for maneuver is relatively limited. Nevertheless, Agriculture Minister Norbert Totschnig is intervening and bringing meat into the discussion.

Andreas Babler's scope for relief is limited.(Bild: APA/HELMUT FOHRINGER)

"Meat is a staple food."
"The proposal as to which staple foods should be covered by the reduced sales tax is currently being negotiated within the coalition. I don't want to preempt this decision-making process. As Minister of Agriculture, it is important to me that the list is based on foods that are produced in Austria. For me personally, meat is clearly a staple food," says Totschnig.

Meat is a question of price
A tax cut on meat and meat products such as sausage would cost an additional 300 million euros. Cheese is also reportedly under discussion. The NEOS party apparently has concerns about unlawful discrimination. Cheese from Upper Austria could not be on the list, but cheese from Bavaria could. This would contradict EU law, they say.

Advertising for meat is being banned in Amsterdam.(Bild: isavira - stock.adobe.com)

The issue of meat consumption has long since become a political issue in the Western world. In most EU countries, food is subject to tax breaks. In 22 of the 27 EU countries, a reduced rate applies; in Germany it is seven percent instead of 19 percent, and in Austria it is ten percent instead of 20 percent. For staple foods, the tax rate will fall below five percent from July 1.

Amsterdam bans meat advertising
In Germany, there is discussion about raising the tax rate on meat because meat production has a significantly larger ecological footprint than other foods. Amsterdam bans advertising for meat and fossil fuels. Starting this summer, advertising for hamburgers, cruises, diesel cars, and air travel will no longer be allowed on streets, squares, and bus stops. A majority of the city council voted in favor of the ban. According to the city, Amsterdam is the first capital city in the world to ban meat advertising.

Criticism of "low-price mania"
Criticism of the emotional debate on inflation comes from Günter Thumser, managing director of the Branded Goods Industry Association (MAV). He speaks literally of a "low-price mania" among supermarket chains. He says this is the only topic that matters anymore. This is linked to manufacturer bashing. But that would not reduce inflation, according to Thumser. He describes the VAT reduction for selected staple foods as an "expensive dip into the budget." He does not expect it to have a lasting effect.