Sweet news for pro-sugar tax
THE sugar tax in Mexico reduced consumption of sugary drinks even more in its second year than in its first, a new study in the Health Affairs journal has found.
This is important for South Africa, which is contemplating a tax on sugar-sweetened drinks.
Healthy Living Alliance spokesperson Tracey Malawana said: “This new study provides compelling and timely new evidence that quick action is needed by parliament.”
One of the Health Affairs researchers, Professor Barry Popkin of the University of North Carolina’s Gillings school of global public health, said health researchers and economists used three different sets of data, but all came up with the same result: Mexicans were drinking fewer sugary drinks.
They drink two to three litres of fizzy drinks a day, he said.
The tax led to a overall 5.5% reduction in the consumption of sugary drinks in the first year of implementation in 2014 and continued to decline, averaging 9.7% reduction in the second year.
Untaxed drinks, including bottled water, increased in volume at 2.1% in 2015. Mexico’s poorest dropped their purchases of drinks the most, meaning the sugar tax affected them the most.
Popkin said: “They have the most undiagnosed diabetes and diagnosed diabetics get the poorest treatment.”
He said they had the least money to spend on healthcare so it was good the tax was helping to change behaviour.
The global beverage industry has heavily criticised Mexico’s sugar tax data, saying the tax does not work and using claims of failures to discourage other governments, including South Africa, from introduce one.
The industry reports that the amount of money spent on soft drinks in Mexico increased during the tax.
“This is true,” said Popkin, “but it didn’t take into account the rising prices of drinks due to inflation and the growth in population buying drinks.”
He said when the number of drinks sold was divided by the burgeoning population numbers, Mexicans individually drank less.
Popkin said economists conducting the study also analysed Mexican individual household purchase data and found households were buying less.
“Industry has never been able to question our methods.”
Popkin said that a proposed reduction in sugar tax in South Africa would cut its potential health benefits in half.
It would be an 11% increase on the price of Coke rather than the initial 20% proposed by Treasury last year, and the tax on concentrate juice, to which water is added, will be even lower.
Popkin said if only 11% were enforced, the industry in South Africa would not be pushed by the tax to reformulate their drinks and reduce sugar content.
He said even if there were job losses, which he doubted would happen, in the long haul nearly 10million people in South Africa would benefit.
While Treasury estimates 5 000 job losses, Popkin’s South African research estimates only 3 000 jobs lost, far below the 60 000 the industry says are at risk.
Popkin said: “In Mexico, there have been no job losses because truck drivers will be distributing water in place of sugary drinks and bottling of drinks is largely automated.”