‘Chips tax’ on unhealthy foods?
Several years ago, the prime minister of Hungary declared that those who ‘‘live unhealthily’’ should pay more tax.
Coined the ‘‘chips tax’’, Viktor Orban’s administration applied excise to any sugary, salty and fatty foods, plus alcohol and energy drinks.
This drastically changed manufacturing processes in Hungary - since 2011, 40 per cent of food companies have tweaked their recipes so fewer unhealthy ingredients are used, and they can sideline the chips tax.
In New Zealand we’ve been debating the sugar tax for some time, though not as seriously as in the UK (where one will be implemented next year).
Is there a case for taxing all foods containing unhealthy ingredients, in order to force obesity interventions on both consumers and the food industry?
The Danes would hesitate if you asked them. In 2011, when dietary fat was still being vilified as the worst thing you can put into your body, Denmark launched a tax on saturated fat. The Danish government - like many other governments have in the past, including our own - believed fat was the only dietary problem worth addressing.
It didn’t account for how determined their people would become to get around the tax: they were steadfast on buying food products containing more than the maximum 2.3 per cent saturated fat. Danes would travel to Sweden and Germany to stock up on cooking oil, butter, meat, pizza, and lard, and within 15 months the tax was withdrawn; owing to worries about border trade and industry lobbying.
In the Indian state of Kerala in 2016, a 14.5 per cent tax was adopted on fatty junk food by its communist government.
The highly-criticised tax has been accused of trying to warn Keralans off branded Western foods in favour of traditional dishes, as it only applies to items such as pizza, burgers, doughnuts and tacos. There’s no word from the Kerelan government yet on the tax’s success on obesity rates.
Turning to salt taxes, both the United States and New Zealand have debated them. The US’ Food and Drug Administration (FDA) proposed voluntary targets for reducing mean sodium concentrations in each food category in 2016, but this didn’t go anywhere.
A 2015 University of Otago study claimed a salt tax could save the health system around $1 billion. The health minister at the time, Jonathan Coleman, confirmed there was no plan to introduce such a tax, and the issue has since gone cold.
Research published in the American Journal of Public Health has found that small excise taxes on unhealthy foods will likely yield substantial revenue for a government, but won’t affect nationwide obesity rates.
Japan, however, has taken fat taxing to a more literal level. Between 2008-2015 it implemented a law that involved annual waist measurement by all people aged 40-74; administered by employers and local government bodies.
Japan’s Ministry of Health claimed physical measurement of its citizens’ bellies would bring down rates of obesity, stroke and diabetes, and those who failed the waist test received counselling sessions or met with a health expert to discuss dietary options. Today, only 3.5 per cent of Japanese people are obese (in New Zealand, conversely, it’s 32 per cent). It’s unlikely that such an invasive intervention would pass into law in a free and open nation such as ours, however.
Aside from the UK, the only other nations that will implement a sugar tax in the coming years are Spain, Portugal and Estonia.
Nutrition remains a polarising topic with misunderstanding on all sides.
Whether or not those who ‘‘live unhealthy’’ should be taxed higher for it also remains debatable.
For now, Hungary is the only nation in the world that has seen any kind of success in taxing all unhealthy foods because it has encouraged a form of industry selfregulation.
Lee Suckling has a masters degree specialising in personal health reporting. Do you have a health topic you’d like Lee to investigate? Send us an email to life.style@fairfaxmedia.co.nz with Dear Lee in the subject line.