By SYLVAIN CHARLEBOIS
Atlantic Institute for Market Studies
IMPOSING A SIN TAX on foods that are deemed environmentally detrimental seems to be gaining support. But little can be accomplished by taxing meat.
For some, eating meat is considered a sin and therefore meat products should be taxed, like alcohol and tobacco. A new report published recently by a group called Farm Animal Investment Risk & Return (FAIRR) argues that a tax on meat is inevitable.
The meat industry – and particularly the cattle sector – has faced relentless criticism over the last decade.
Science-based findings connecting climate change and livestock production have piled up. The Food and Agriculture Organization (FAO) of the United Nations reports that livestock account for about 14.5 per cent of the world’s greenhouse gas emissions. Other surveys suggested up to 18 per cent.
And greenhouse gas emissions produced by the cattle industry will only increase, since the middle classes in India and China are expanding and, as as result, demand for animal protein is exploding.
Then there are the health issues. Two years ago, the World Health Organization linked meat consumption to cancer. The report demonstrated that eating processed meat products increases the risk of developing cancer.
Arguing that meat is the new tobacco is sensationalist nonsense, since tobacco is not essential to life and food is. Let the market evolve
Several meat-producing countries, including Canada, the U.S. and Brazil, ridiculed the report, which lumped processed meats with asbestos.
But several other governments, including in China and in Europe, have actively discouraged their populations from consuming an unreasonable amount of meat. That’s not a signal the meat industry needs.
The other major headwind the industry faces is related to the ethical treatment of animals. Many people believe livestock production is unethical and that the industrial production of meat should be outlawed. The ethics narrative has gained traction over the last decade or so.
Now, if you think FAIRR is a minor, under-resourced group desperately seeking attention, think again. It includes 57 investors with more than $2.3 trillion under management. This alliance is clearly influencing the plant-based protein agenda.
Already, agri-food giants like Tyson Foods and Cargill are looking at “beyond-meat” solutions. Demand-focused companies see the writing on the wall. Many consumers are re-evaluating their relationship with animal proteins.
But in cattle country, a large number remain in deep denial, blaming interest groups for fear-mongering.
And demand for meat in Canada is still stubbornly robust. The average Canadian consumes about 87 kg of meat products a year, just slightly lower than five years ago. In 2017, Canadian beef consumption reached 25.4 kg per capita and some expect demand to increase to 25.5 kg this year.
All that is perhaps surprising but beef prices have come down, making it more attractive for budget-conscious consumers.
Alberta is by far the largest consumer of beef – the average adult male will eat 83 grams a day. That’s 53 per cent more than in Newfoundland and 18 per cent more than in British Columbia. Affordability and lifestyle help explain the differences.
But overall, meat consumption habits are changing. Demand for pork is expected to fall to unprecedented levels in 2018, dropping 13 per cent from 2015. Demand for chicken, one of the cheapest animal proteins, plateaued in 2016 and has since softened. Although beef could rebound in 2018, increases aren’t expected to be spectacular, given how low retail prices are already.
Canadians aren’t giving up on meats but they’re willing to spend more time away from the meat counter. Animal protein still has market currency, but plant-based alternatives are increasingly impressive.
Taxing any food product is morally questionable. A retail tax on food is regressive and could penalize the underprivileged.
Yet some argue that meat is the new tobacco. This parallel is sensationalist nonsense, since tobacco is not essential to life and food is.
Implementing a meat tax would be difficult. If federal or provincial governments were to tax meat, funds would likely be used to support relevant public programs. But how tax funds are dispersed is always difficult to track, so the direct value of a tax would be suspect.
Also, many successful small (and family) businesses across the country offer high-quality meat products to local markets. Taxing these products would compromise the viability of many businesses valued in thousands of communities.
Meat has played a significant role in the western world for centuries. Penalizing consumers for continuing a culinary tradition is inexplicable. Taxing a food product that’s been entrenched in our culture for so long is idealistically silly.
Rather, we should let the market evolve and allow consumers to make their own choices.
Nevertheless, the livestock industry needs to look at market data and start listening to consumers’ concerns.
Sylvain Charlebois is Senior Fellow with the Atlantic Institute for Market Studies, dean of the Faculty of Management and a professor in the Faculty of Agriculture at Dalhousie University, and author of Food Safety, Risk Intelligence and Benchmarking, published by Wiley-Blackwell (2017).
© 2017 Distributed by Troy Media