In an interview last week with the BBC, Beyond Meat’s chief executive Ethan Brown expressed his support of a Pigouvian tax on meat products. “The whole notion of a Pigouvian tax, which is to tax negative things that are high in externalities, I think is an interesting one. I’m not an economist, but overall that type of thing does appeal to me,” Brown told Talking Business broadcaster Aaron Heslehurst.
Beyond Meat is the world’s biggest plant-based meat company, this year penning a three-year worldwide agreement with McDonald’s to supply its plant-based products to the QSR giant, while an additional deal was also signed with with Yum! Brands, parent company to Taco Bell, KFC and Pizza Hut.
The aim of a Pigouvian tax on meat products is a potential next step in the food industry’s fight to tackle climate change. Plant-based meat products are considerably more expensive; therefore, the imposition of a meat tax would help to level out the financial imbalance between meat products and their plant-based counter parts, encouraging the sales of plant-based alternatives. Brown (pictured) clearly has a clear vested interest in this turn of events, but how will this potential tax affect the wider foodservice industry and its consumers?
“I strongly believe this will have a negative impact on the industry and with consumers,” says foodservice consultant Arlene Spiegel, president of Arlene Spiegel & Associates, Inc. in New York, US, in reaction to Brown’s interview.
“The industry needs to find a more positive way to bring attention to the climate change issue than by taxing meat products. It is too judgmental and will require an enormous effort to educate the public in order to make the connection between meat consumption and climate change,” says Spiegel.
However, there is evidence to support that consumers are already shifting their shopping habits, with more choosing to split their spending between meat and plant-based products. Even without such a tax, Brown states that consumers are already making the choice to eat less meat. “If you look at shopper data that we have, 93% of the people that are putting the Beyond Burger [a plant-based burger that looks and cooks like beef] in their cart are also putting animal protein in,” he said.
If consumers are, as Brown’s statistics suggest, making the choice to eat more plant-based products, then a Pigouvian tax could be seen as a natural progression in the promotion of meat-free food alternatives. However, the transition to the implementation of such a tax is not casualty-free. Spiegel likens the potential reaction of a meat tax to that of New York Mayor Michael Bloomberg’s imposed tax on sugary sodas that caused uproar amongst New Yorkers despite the messaging suggesting the tax was being imposed to bring attention to the “health consequences” of drinking the beverages.
Walk the talk
There are other ways to promote plant-based diets that don’t impact consumers’ pockets, Spiegel urges. “Feature more plant-based dishes and ingredients on their menus; include the names of the producers and farmers who supply the establishment; commit dollars and time to education in schools and communities; walk the talk,” she says.
Whether a Pigouvian tax on meat products will be implemented is to be confirmed, but Spiegel warns that a taxation on meat products will eventually be passed on to the consumer. “While it might bring awareness, I doubt it will change behaviour,” she warns.
The potential impact this taxation might have on the food industry and consumers is far reaching. Although it may be the inevitable next step in government programmes to change consumption habits, there are still likely to be intermediatory changes that will be implemented first before such a tax is imposed.