Home / FT View/ Bittersweet taxes

Bittersweet taxes

Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 14 November 2017 00:00

The Government has proposed increasing the tax on sweetened drinks, aiming to expand its current colour scheme to milk-based products as well, to discourage the public from consuming unhealthy food. However, private companies may find it hard to adapt given that public demand is still centred on what tastes good. 

Unfortunately it is human nature to want what is bad for us, so few people will take the initiative to be healthy. Locally as much as 85% of ill-health can be traced back to Non-Communicable Diseases (NCDs) such as diabetes, cancer, high blood pressure and kidney diseases among others, mirroring a developed country. Also there is an indication that poorer people are more likely to be affected by poor diet choices than wealthier members of society.  

Sugar is widely available and cheap. Over the last decade, global sugar consumption has grown from about 130 million tonnes to 178 million tonnes as companies use sugar in pretty much any food item. The World Health Organization’s (WHO) sugar guideline, issued in March 2015, recommends that adults and children restrict their sugar intake to less than 10% of their total energy intake per day, which is the equivalent of around 12.5 teaspoons of sugar for adults and suggests a further reduction to below 5% of the total energy intake per day.

Effective and feasible policy actions are available for governments to reduce the availability and affordability of sugar and sugary products, influence the acceptability of alternatives and raise awareness about the sugar contained in products in an effort to move towards meeting the WHO sugar guideline.

Examples of actions which have had these effects include school nutrition standards in Queensland, Australia; a vending machine ban in France; a front-of-package symbol that led to product reformulation in the Netherlands; soda taxes in France and Mexico; a program targeting retail environments in New York City, US; a program promoting increased water consumption in schools in Hungary; school fruit and vegetable programs in the Netherlands and Norway; a healthy marketing campaign in Los Angeles County, US and a comprehensive nutrition and health program in France.

Experience from officials implementing these policies and pilot programs provides important insights for governments to help them design more effective policies to reduce sugar intake in the context of broader dietary improvements. 

Insights include the need for measurable indicators of change; engagement, incentives and clear standards for entities involved in the manufacture and delivery of food; actions to inform stakeholders about the broader benefits of reduced sugar consumption; clear and understandable messages for consumers and synergistic and complementary actions.

A comprehensive approach is needed to reduce sugar consumption at a population level. Part of this comprehensive approach should be dialogue with stakeholders in the sugar supply chain to identify what ‘upstream’ actions can be taken to reduce the supply and demand for sugar, taking into consideration the economic impact of such actions. 

Given the relatively low health spending of 4% of GDP, NCD care in Sri Lanka is increasingly financed by out-of-pocket spending by the general public. Tackling NCDs in South Asia early on with better prevention and treatment will significantly spare poor people from the crushing burden of poor health, lost earnings, deepening poverty and the risk of disability and premature deaths. Clearly the Government has to sweeten the deal in more ways.

Share This Article


Today's Columnists

Walking an adaptable path to your cloud vision

Tuesday, 16 January 2018

While most companies have a vision of their cloud future – where everything in IT is simple, flexible, elastic making it easy to innovate, be swift to market and delight customers– fewhave a clear view of how to get there.This isbecause they are

International Financial Reporting Standard for Insurance Contracts (IFRS 17) in Sri Lankan insuran

Tuesday, 16 January 2018

Insurance accounting has never been easier for accountants due to the complicated nature of insurance contracts when assessing the liability arising from insurance contracts. This is where actuarial skills and expertise are required in order to calcu

In praise of President Sirisena

Tuesday, 16 January 2018

“Being in a minority, even in a minority of one, did not make you mad. There was truth and there was untruth, and if you clung to the truth even against the whole world, you were not mad.” –George Orwell, 1984

Five Ps – President, Parliament, Politics, Performance and People

Tuesday, 16 January 2018

As we all know, President Maithripala Sirisena has sought the opinion of the Supreme Court that whether, he, as the person elected on 9 January 2015, has any impediment to continue in the office of President for a period of six years. In terms of the

Columnists More