A few have answered saying that /etc/environment is depricated and/or not used in Debian anymore, and this is (as at version 7) false.
The file is actually read by PAM -- specifically, pam_env(8), via a default to the envfile flag. The manpage also states this default under the FILES section.
The wikis quoted (especially the locale one) merely state that locale-based environment variables are now meant to be in /etc/profile. Their statement "(in older versions of Debian, also /etc/environment)" is vague, and is in the context of locales.
A quick grep through /etc/pam.d shows:
root@box:/etc/pam.d# grep pam_env.so *
atd:auth required pam_env.so
cron:session required pam_env.so
cron:session required pam_env.so envfile=/etc/default/locale
login:session required pam_env.so readenv=1
login:session required pam_env.so readenv=1 envfile=/etc/default/locale
sshd:auth required pam_env.so # [1]
sshd:auth required pam_env.so envfile=/etc/default/locale
su:session required pam_env.so readenv=1
su:session required pam_env.so readenv=1 envfile=/etc/default/locale
Those config lines are additive, and as the first is missing envfile, it thus defaults to /etc/environment.
All of this, of course, relies on whatever binary you're using (crond, login shells etc) are compiled against PAM.
Finally, this implies that other systems using PAM (eg RedHat), behave the same, as can be seen in it's respective manpage.