Feds examine soda tax as obesity fighting tool
OTTAWA — The federal government has weighed the pros and cons of a financial deterrent aimed at shrinking bulging waistlines: a tax on soda pop.
Finance Minister Bill Morneau’s office requested an internal analysis last winter to explore the “issues and impacts in respect of a potential tax on soft drinks.”
The information was contained in a Jan. 29 briefing note prepared for Morneau as he drew up the federal government’s maiden budget, which was tabled in March.
“A number of health organizations have called on the government to implement taxes on sugar-sweetened beverages [SSBs], as a strategy to address obesity,” reads the memo signed by deputy finance minister Paul Rochon.
The partially redacted, “secret” briefing was obtained by The Canadian Press under the Access to Information Act.
As an example, the document pointed to a pre-budget recommendation made by the Heart and Stroke Foundation, which urged Ottawa to impose a tax of five cents per 100 millilitres on sugar-sweetened beverages. The Heart and Stroke Foundation told Ottawa that such a levy would be a sustainable source of tax revenue that would generate $1.8 billion every year for the public treasury.
In Morneau’s spring budget, the government pledged to help “families make better food choices” and indicated it would take steps during 2016-17 to add more details on food labels about added sugars and artificial dyes in processed products. The budget made no mention of imposing taxes on sugary or fatty foods and beverages.
Asked about the analysis, a spokeswoman for Morneau said it was requested during the pre-budget period when the finance minister’s office was in exploratory mode and had a responsibility to examine options and proposals.
“This is an issue that was raised in the pre-budget consultation period by several stakeholders — both for and against — and we asked for an analysis in order to better understand it,” Annie Donolo said in an email. “We encourage anyone with a point of view to engage with us. It’s an important subject with many facets, and we expect it will come up again as we hear from people ahead of the next year’s budget.”
The push to tax sugar-filled beverages has gained momentum in recent months.
In its pre-budget submission, the Heart and Stroke Foundation said health experts have described sugary drinks as a “significant driver of chronic disease and obesity.” It also insisted that taxing sugary drinks has cut down on consumption in some jurisdictions.
In March, a Senate committee released a report about fighting obesity that recommended Ottawa explore implementing a new tax on sugar-sweetened and artificially-sweetened beverages.
The Canadian Beverage Association has opposed any plan to tax sugar-sweetened and artificially sweetened drinks. The association, which represents 60,000 workers in the industry, has said that efforts to tax these products have proven ineffective in reducing consumption in other jurisdictions. It also warned it would increase the cost of groceries.