Realists defeat idealists as McGuinty kills fat tax

"This was never about healthy diets," New Democratic Party MPP Marilyn Churley said. "This was about dealing with their deficit on the backs of the poor. Now they've caved into the big industry lobbies. And I'm glad to see that the Premier has performed one of his spectacular flip-flops that he does so well."

The Globe and Mail
April 21, 2004

Realists defeat idealists as McGuinty kills fat tax
Richard Mackie

A popular revolt has forced Premier Dalton McGuinty to scrap plans for a so-called fat tax on cheap meals as realists in his government won an internal battle against crusaders who wanted to use tax policy to promote healthier eating habits.

The Premier declared yesterday that the May 18 budget would not eliminate the exemption from the 8-per-cent sales tax that is allowed on prepared meals selling for less than $4.

The idea had been floated in recent weeks as a way of raising revenue and forcing Ontarians to rethink fast-food meals. But an outcry by poverty activists combined with a petition in fast-food outlets — including every Tim Hortons in the province — appeared to have persuaded Mr. McGuinty to reconsider the tax.

The decision, which will cost the government the chance to pick up at least $200-million in revenue, was the latest in a series of perceived flip-flops on ill-fated policy initiatives.

Both the Progressive Conservatives and the New Democrats in the legislature were gloating yesterday at what they were quick to declare was a victory in a political battle the government chose itself.

"This was never about healthy diets," New Democratic Party MPP Marilyn Churley said. "This was about dealing with their deficit on the backs of the poor. Now they've caved into the big industry lobbies. And I'm glad to see that the Premier has performed one of his spectacular flip-flops that he does so well."

But while a multitude of Liberal antagonists were claiming paternity for this victory, the true winners were those within the government, including MPPs, cabinet ministers and veteran strategists who had labelled the "soup-and-salad tax" a bad idea from the start.

Caucus members reported that they were unhappy with the unrest over the tax.

Veterans among the Liberals recalled that a previous incarnation of the Liberal Party promised, in the 1985 election campaign, to exempt low-cost meals from the sales tax. They had learned the dangers of taxing inexpensive but necessary items by watching the anguish of former Tory treasurer Frank Miller when he put a tax on feminine-hygiene products.

Talk of the tax began in January when a government consultation document suggested the exemption could be eliminated.

The debate picked up momentum on April 8 when Mr. Smitherman declared the need for "a revolution" in public health, including an assault on unhealthy fast foods. Coincidentally, that day lobbyists for food chains including Tim Hortons and McDonald's were calling reporters to announce a campaign to block the government's plans to remove the tax exemption on cheap meals.

After that, lobbyists led by Terry Mundell, president of the Ontario Restaurant, Hotel and Motel Association, cited statistics to back their opposition to removing the exemption that Tory and NDP critics quickly picked up.

"Over 90 per cent of the meals in hospitals are sold for under $4. In the education system, over about 85 per cent of meals are sold for under $4. Every day, 1.5 million Ontarians buy a basic meal under $4 from your local food-service establishment," Mr. Mundell said in an April 13 interview.

Yesterday, after a week of internal debate, Mr. McGuinty said he had had a constructive meeting with the representatives of the restaurant industry who had been battling the change.

"We're not going to proceed with the food tax. I had a very productive meeting late [Monday] afternoon with the restaurateurs and have secured their agreement that we are going to work together to ensure that the people of Ontario, but particularly our children, have greater access to healthier foods," the Premier said.


Brought to you by WikidFranchise.org

Risks: Obesity, Ideas once considered outrageous are now normal, Childhood obesity, Fat tax: raising the cost of bad food choices, Industry muscle, Money influencing public decision-making, Money swears, Canada, 20040421 Realists defeat

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License