The Sugar Tax

What is it?

The idea of the sugar tax has been thrown around a lot over the past few years. It is a tax only applying to sugar sweetened beverages. Australia is proposing 20%, which would apply to all the classic sugar laden soft drink giants. For example, Coke, Sprite and Fanta. It would also apply to a few of the less obvious culprits such as mineral waters, energy drinks and flavoured milks. The tax aims to reduce the consumption of these drinks through an increase in their price, making them less desirable to the consumer. Hence, having positive effect on the health of our society, decreasing the prevalence of overweight, obesity, diabetes, dental caries and other chronic diseases. Many people think the sugar tax is a good idea. Many don’t. Let’s have a look at both sides of the argument and I’ll let you decide which side on which you sit.

Pro the Tax

A sugar sweetened beverage tax is backed by WHO, the Australian Medical Association, Dietitians Association of Australia and many other organisations with an interest in public health. Such organisations believe that currently, the government is not doing enough to fight the obesity crisis. Evidenced by its ever-worsening nature. Even when armed with the knowledge to understand healthy choices, the public persists to choose high sugar drinks. Again, this notion is evidenced by the persistent obesity crisis, that continues to spiral out of control despite intensive education-orientated public health intervention.

Aside from driving down consumption, a sugar tax puts pressure on the beverage industry to reformulate. Companies would put significant effort in to reducing the sugar content of their drinks to avoid taxation. Currently, there is no pressure to do this. There is already evidence to suggest a tax can drive reformulation.

Axe the Tax

Who can you think of that might be against a sugar sweetened beverage tax? Pretty much every beverage company ever. Obviously, the beverage council vehemently objects to a sugar tax. They claim this is because it will have no effect on the health of our nation. It is convenient that it will also save them a 20% axe to revenue. As per usual, the industry has twisted the evidence in favour of their profit.

A study out of Mexico states that that with the introduction of a sugar tax, the purchasing of sugary beverages rose from 6.4% to 7%. Which is true, but not the whole truth. After adjusting for population growth, seasonal trends, economic growth and the like, the institute claimed that in real terms, the sales of sugary drinks fell by 8%. Furthermore, a 17 week sugar tax trailed in a Melbourne hospital showed a 26.7% decrease in the purchasing of sugary drinks, and a similar increase in the purchasing of bottled water. Recently, the UK has implemented a sugar tax, with already promising results. It would seem as though there is significant evidence to support the notion that a sugar tax can positively influence consumer behaviours. Where the pro tax argument falls down, is the translation of this to health. Health is complex to measure, it is multi-factorial and changes are slow, taking years to measure. For this reason, evidence that proves the benefit of a tax for health, is weak. While it is slowly emerging, it is not quite there yet. It is predicted, however, that the results will follow similar patterns to that of purchasing behaviours, which is a pretty positive outlook.

The Tension

It seems the pro tax has some good points to make. The anti-tax side also has some arguments to make, which are decidedly weaker. With this in mind, why is it that we are yet to implement the tax?

The government is cautious. While this is a good thing in so many areas of politics and society, it’s not so good in this case. Right now, we need action. The Australian government maintains a ‘hands off’ approach to health meaning it aims to provide its people with the option to be healthy, but in no way, will nudge them towards the healthier choice. It fears adopting a ‘nanny state’ which refers to taking away people’s choice in order to achieve a better society. Hard to tell if the government’s fear of adopting this state or strong lobbying ($$$) from the beverage industry is stronger.

Putting it in Perspective

By no means is the pro tax side trying to communicate that the sugar tax is a one stop solution to our obesity crisis. It simply is not. Sugar in beverages is only one small problem within a largely obesogenic society. We should, however, not underestimate the power of small changes, especially if supported with a variety of other interventions, that may give us a fighting chance against the public health crisis.

Share this post: