Would You Pay a 20% “Fat Tax”?
A “fat tax” of at least 20% is necessary to improve population health, says a new study in the British Medical Journal. More and more countries including Denmark and Hungary have introduced taxes on unhealthy food. Oliver Mytton and other researchers at the University of Oxford say that such taxes “have the potential” to improve health and should “ideally” be combined with subsidies for health foods such as fruits and vegetables.
Mytton and his colleagues noted that evidence especially points to the need to tax sugary drinks:
For example, a US study found a 35% tax on sugar sweetened drinks ($0.45 (£0.28; €0.34) per drink) in a canteen led to a 26% decline in sales.
Meanwhile modelling studies predict a 20% tax on sugary drinks in the US would reduce obesity levels by 3.5%, and suggest that extending VAT (at 17.5%) to unhealthy foods in the UK could cut up to 2700 heart disease deaths a year.
Opinion polls from the US also put support for tax on sugary drinks at between 37% and 72%, particularly when the health benefits of the tax are emphasized. For example, a US study found a 35% tax on sugar sweetened drinks ($0.45 (£0.28; €0.34) per drink) in a canteen led to a 26% decline in sales.
How to introduce and enforce such taxes remains to be seen, as does what to do with any funds collected. Some activists say that the taxes should be used to fund research about “treat[ing] diet related diseases, subsidiz[ing] healthy foods, or … stimulat[ing] industry reformulation of food (such as removal of salt, sugar, or saturated fats from foods).”
Not surprisingly, the food industry is against such taxes, calling them “ineffective” and “unfair” and contending that they will lead to job losses.
It is the case that sales of soda are declining. According to the New York Times, in 2011, the average American drank slightly under two sodas a day, a 16% decline since 1998. But, companies like Coke and Pepsi actually saw their revenue from soft drinks increase to a record high of $75.2 billion last year, by raising prices.
The beverage industry is not, that is, taking lightly efforts by health advocates and a general public seeking to do the right thing to be healthy. As Dr. Harold Goldstein, executive director of the California Center for Public Health Advocacy, notes in the New York Times:
Beverage companies are putting more and more emphasis on selling fortified beverages, as if fortified means healthier when in fact it often means more salt added to sugar.
Indeed: While I’ve noted fewer students drinking soda, I’ve definitely noted a significant increase in the consumption of energy drinks, and not only at final exam time.
Drinking water is just never easy to convince anyone to do, apparently, hence the need for something like a “fat tax.” Would having one in the US change your eating habits and/or that of your family? Could such a tax indeed be passed in the US, home of, yes Coke and Pepsi?
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