HEALTH OR JOBS?

Denmark is losing jobs in the rural areas north of the German border, as Danish consumers exercise their E.U. rights and trundle across the border to shop in Danish-owned hypermarkets. The main reason is the lower taxes and duties in Germany. These are particularly high on beer and sodas, two goods which lend themselves to borrowing a trailer and driving down to Flensburg for a shopping fest. I have done it myself a couple of times.

Differences in VAT apply to all goods. But the duties on beer and sodas were introduced by the Danish Government as a health measure, not least in order to combat spiralling obesity, particularly in children. Cutting the duties would slash the incentive to shop over the border. But what about that health issue?

When push came to shove, as it did this evening, shopping in Denmark rather than Germany (and the retail jobs associated with it) won out over slimmer children. As part of its long-touted "growth package", the duties will be sharply reduced. Danes in the future will be richer, but fatter.

Walter Blotscher