Taxation Based on Dose of Ingredients in Sugary Drinks May Help Fight Obesity

Worldwide, an estimated 1.9 billion people are overweight, of whom 600 million are obese. Sugary drinks are a significant contributor to obesity since they have a high sugar content and low nutritional value. A few countries like Mexico have already imposed a tax on these sugary drinks. A new study has revealed that a tax on sugary drinks that depends on the number of calories or amount of sugar per liter could help fight obesity. This move would encourage drinks companies to offer low-calorie alternatives. Author of the study Dr. Evan Blecher, senior economist at the American Cancer Society, said, "Taxing sugary drinks isn’t a new concept, but given the immediacy of the global obesity problem, it’s time we got creative with how we approach it. We could get sharper effects from taxation if we tax the dose of an ingredient, like sugar, or calories."

The research team drew comparisons between taxing tobacco, alcohol and sugary drinks, using South Africa as a case study. The results of tobacco tax suggest that taxing by the number of cigarettes is the best approach. In case of alcohol and sugary drinks, this would mean taxing by the volume. This dose approach to taxation has been effective at reducing the consumption of alcohol in South Africa, reducing the amount of alcohol consumed in beer by 12% since 1998.

Blecher said, "This is not that different from the conceptual understanding of carbon taxes, the idea is to tax the dose of the pollutant to incentivize consumers and producers to use better technologies to reduce carbon."

The study appears in Social Science & Medicine.

Source-IANS