Junk Food Regulation: Taxing Our Way to a World-Wide Healthier Future?
UN investigators are projecting that obesity and related illnesses will in the long-term pose as significant a threat to our global health as tobacco once did. As a result, they say it’s time to start seriously considering higher taxes on so-called bad foods — but will that really help?
The United Nations Special Rapporteur on the right to food, Olivier De Schutter, spoke in Geneva on Sunday ahead of a conference prefacing a Global Convention to Protect and Promote Healthy Diets. De Schutter argues that, in the same way that global powers have worked together to regulate tobacco and thereby tackle its health risks, global powers should do the same when it comes to promoting a healthy diet and trying to tackle Western obesity rates.
“It has been two years since my report on nutrition and the right to food, and ten years since the World Health Organization (WHO) launched its Global Strategy on Diet Physical Activity and Health,” De Schutter is quoted as saying. “Yet obesity continues to advance — and diabetes, heart disease and other health complications along with it. The warning signs are not being heard.”
According to the Centers for Disease Control and Prevention (CDC), more than one-third of U.S. adults (34.9%) are obese, and obesity-related conditions including things like heart disease, type 2 diabetes and certain types of cancer, are becoming more prevalent despite being preventable.
As a result, De Schutter and the United Nations task force responsible for tackling this issue want a five pronged approach. Among their recommendations is a higher tax on unhealthy food products. The UN also wants to regulate foods that are high in saturated fats, salt and sugar, ensuring there are stricter controls on foods that are known to be obvious health risks (more on this below).
In addition, the UN wants tighter controls on junk food advertising — particularly to prevent advertisements being aimed at children. Lastly, the UN wants to tackle agricultural subsidies that the food industry has used to make certain ingredients cheaper while unfortunately pricing out local produce. This, the UN hopes, will allow consumers to have access to healthy and nutritious food.
“Governments have been focusing on increasing calorie availability, but they have often been indifferent to what kind of calories are on offer, at what price, to whom they are made available, and how they are marketed,” De Schutter explained. He wants to change that.
Despite the above recommendations being part of a broader move to tackle rising health concerns, the press has jumped on the junk food “sin” tax, and so we’re forced to deal with the issue as well. Chiefly, could it work? If global powers collectively agreed to regulate the food industry by slapping higher taxes on known junk foods and things like fats, sugar and salt, could this help us fight obesity?
Number crunching throws up some quite positive results. Earlier this year, the National Bureau of Economic Research released a study showing that if we were to raise the tax on high calorie food by 10%, there could be an equivalent drop in body fat percentage by 8-9% among children, thus setting them up for a healthier start in life. It’s not quite as simple as that though. A range of factors affect how we react to higher food prices, including racial background, income and even our gender. Raising the price of fatty foods meant men tended to stop buying them, whereas for women the motivating factor was how cheap fruit and vegetables were in the market. Clearly, we can’t simply implement a blunt tax hike, particularly because it would likely adversely affect the very people that you’re wanting to help: the poor.
This is just one study, but there have been others that have shown similar positive projections, with one even suggesting that a 20% raise on junk food would be necessary to get the desired results, but that it is possible. In terms of practical examples, though, the results have been more mixed.
First a word on the problem with definitions. We’re talking above about a high calorie tax. High calories tend to point to foods that are bad for us, but not necessarily. A lot of nuts are, per pound, highly calorific and yet they are full of protein and so-called good fats. Indeed, if we talk in terms of “fat taxes,” certain fishes might succumb to a higher tax rate despite white meat being arguably better than red meat –and what of the fact that science has shown that the idea of “good” and “bad” fats might be misleading? These things would have to be accounted for. They’re difficult, but not insurmountable. Much harder still is combating the food industry and winning over the public.
Take Denmark, which instituted a so-called fat tax in 2011. The ban was a world first, and it was designed to be a model for how to raise the prices of fatty fast foods. Denmark already had a firm handle on things like product labeling and was also thought to be quite resistant to food industry pressures, so was billed as the perfect test area for a ban like this. Unfortunately, by October of 2012, the tax was pulled.
What’s interesting is that the motivating factor behind retiring the tax hike wasn’t so much the burden on consumers, and there wasn’t time enough to know whether ultimately that burden would have created a sustained shift in food choices, but rather food companies. In essence, food companies didn’t like having to factor in the rise on things like cooking oils, and using their considerable political power took action largely by threatening job cuts at a time when Europe was still reeling amid the financial crisis. The government, which didn’t have to deal with a severe obesity problem anyway, decided the policy was far more trouble than it was worth.
Hungary, on the other hand, instituted a similar fat tax in 2011 and so far that tax has remained. We’re still waiting for detailed results on its effects, but early projections show modest success in shifting buying habits. In fact, Hungary is leading the world with its “health taxes,” putting higher prices on things like sugar and salt, and therefore increasing the prices of foods heavy in those ingredients. The money raised by these taxes is being funneled back into the health service to try to combat what is one of the most serious food-related health crises in Europe. The food industry did react negatively to this tax, as did a number of catering industries, but the government has, for now, resisted calls to scrap the tax. This points out to a way forward.
In theory, taxing junk food should work — the numbers tell us as much. Furthermore, things like the successful trans fats ban show us that definitive action can also lead to positive results. What seems to be key here, though, is whether world governments can implement tax hikes while resisting food industry pressure and communicating to the public why these tax rises are necessary. Putting that money directly into health care improvements and obesity-fighting programs are ways in which the tax might be sold.
Let’s be under no illusions, though: despite the evidence that shows what we eat can be just as toxic as smoking, a fat tax will be a hard sell.
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