The European Environmental Bureau (EEB), the
European Association of Consumers (AEC) and the Dutch Bureau of
Food Trade (CBL) called on the EU to boost organic farming.
They presented a study on how to increase organic food
production in the EU to 10% by 2006, by reducing VAT and
introducing levies on the use of pesticides and
The proposal seeks to influence the Action Plan for organic
farming that the Commission started preparing in February.
The EEB argues that organic food production is better for
the environment and health because it uses less pesticides,
fertilizers, hormones and antibiotics. The lower yields of
organic farming could be offset by the set-aside system,
practised under the Common Agricultural Policy (CAP),
according to the proponents of organic farming.
The study proposes the following
economic instruments to stimulate organic farming in
Europe, and to increase consumer demand by reducing the
- 0% tariff of Value Added Tax (VAT) on organic
products to enhance the attractiveness of organic
products in the market;
- Pesticide and fertiliser levies to reduce the
competitive advantage of conventional farming;
- Cross compliance to put environmental conditions on
direct payments that farmers receive under the market
- Modulation to reduce the amount of direct payments
farmers receive under the market regulation with a
certain fixed percentage (maximum 20%).
The study, entitled “Stimulating Organic
Farming in the EU with Economic and Fiscal Instruments”,
estimates that an annual sum of 2.5 billion euro is
required to ensure that 10% of the EU area is farmed
organically by 2006. This money could be raised by
introducing levies on pesticides and fertilisers, and
through cross compliance and modulation.