Sugar Taxes Issues

Taxes meant to increase costs of manufacturing, distributing, and consuming products that damage health have been implemented to reduce overall consumption of hazardous products. Legislation targets socially undesirable products to raise revenue with their “sin taxes” or health taxes (Liu, 2018). Including substances such as alcohol and tobacco, the taxes have traditionally found limited political resistance. Experts from a study on the effectiveness of taxation and pricing policies in tobacco control agree that there is sufficient evidence to support legislation (Chaloupka, Straif, & Leon, 2011).

Not only does it lead to an improvement in overall public health, but also a decline in tobacco consumption, drop in uptake among adolescents, and cessation among current users.

If the primary goal of a health tax is to reduce consumption, then our alarmingly increasing consumption of sugar is also taxable. In an attempt to moderate our rising rates of heart disease, type 2 diabetes and obesity, many are looking to sugary drink taxes. Findings show that these high tax rates have a positive impact on health conditions but have peak impact when the taxes increase the price of the product by 20% or more (Wright, Smith, & Hellowell, 2017).  Countries adopting the sugar tax ideals have seen a decrease trend in chronic conditions associated with being overweight or obese. Colombia has a high prevalence of overweight (56%) and obese (19%) adults in their population (Vecino-Ortiz & Arroyo-Ariza, 2018). A study simulating the long-term effect of sugar taxes on population health showed that overweight and obesity can be reduced up to 4.9% and 2.4% each year, respectively. Comparatively, Indonesia has no fiscal policy in place related to the restriction of sugar consumption. Sugar content in sugar-sweetened drinks contribute to more than 75% of energy obtained from the product (Thahir, Arundhana, & Muqni, 2016). The absence of taxation policies causes a direct increase in sugar consumption and obesity leading to the promotion of non-communicable diseases. To prevent widespread impact, legislature should employ sugar taxes to avoid the enormous health consequences of the future.

Sin or health taxes dictate behaviors that are socially harmful, disfavored, or unpopular. Due to the evolving list of products considered for regulation, it is critical that lawmakers do not use these activities as a way to raise funds. The merits of each substance, such as sugar, must be individually evaluated. Although taxation has clearly shown positive reinforcement in the decline in sugar consumption, there are a few alternative methods to curbing unhealthy behaviors including: direct bans of good or service, labeling of good or service, and access to healthier alternatives. Graphic warnings and text labels have been found to reduce consumption of health damaging items. Healthier alternatives to high sugar drinks such as coffee, tea, and smoothies should be promoted and made widely available to the public. The implementation of both fiscal and non-fiscal policies toward sugar consumption will have the largest positive influence on population health.

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