Health economist backs su­gar tax pro­posal

The Star Early Edition - - COMPANIES - Joseph Booy­sen

AL­THOUGH the pro­posed tax on sug­ary drinks could im­pact jobs in the bev­er­ages in­dus­try, fewer South Africans would be af­fected by obe­sity which leads to chronic dis­eases such as di­a­betes.

This is ac­cord­ing to Dr Frank Chaloupka, an in­ter­na­tion­ally recog­nised health economist and dis­tin­guished pro­fes­sor of eco­nom­ics di­rec­tor at UIC Health Pol­icy Cen­tre Univer­sity of Illi­nois at Chicago.

Chaloupka was speak­ing in Cape Town yes­ter­day, ahead of him pre­sent­ing his let­ter in par­lia­ment to­day, which cites the sci­en­tific ev­i­dence that links sug­ary drink con­sump­tion to obe­sity and re­lated dis­eases and global ev­i­dence demon­strat­ing the ef­fec­tive­ness of a tax on sug­ary drinks.

The Par­lia­men­tary Stand­ing Com­mit­tee on Fi­nance will con­duct pub­lic hear­ings to­day to dis­cuss the planned tax on sug­ary drinks.

Last year, the Min­is­ter of Fi­nance, Pravin Gord­han, an­nounced a plan to tax sug­ary drinks such as soft drinks, en­ergy drinks and sweet­ened milks by April this year, as a mea­sure to lower the con­sump­tion of th­ese harm­ful prod­ucts.

Chaloupka was part of more than 40 global and South African schol­ars who ex­pressed their sup­port of the sug­ary drink tax in South Africa, re­cently.

He said sug­ary drinks are a sig­nif­i­cant con­trib­u­tor to se­ri­ous health prob­lems such as di­a­betes, obe­sity, and heart dis­ease and that obe­sity re­lated dis­eases are among the top 10 causes of death, ac­count­ing for 43 per­cent of deaths in South Africa.

‘Keep in mind that it re­ally has the big­gest ef­fect in the most vul­ner­a­ble pop­u­la­tions.’

Chaloupka’s re­search fo­cuses on the use of fis­cal poli­cies to pro­mote health­ier be­hav­iours and has con­ducted ex­ten­sive re­search on the im­pact of taxes and prices in sug­ary bev­er­age con­sump­tion, obe­sity, health care costs, gov­ern­ment rev­enues, em­ploy­ment and other out­comes.

Chaloupka said taxes on sug­ary drinks were con­sid­ered to be an ef­fec­tive mea­sure to lower the con­sump­tion of sug­ary drinks by pub­lic health ex­perts.

“The ev­i­dence is clear that over the last sev­eral years that sug­ary bev­er­age con­sump­tion in par­tic­u­lar is a sig­nif­i­cant con­trib­u­tor to obe­sity which is be­com­ing a prob­lem in South Africa.

“It is re­ally a cause for Type 2 di­a­betes in par­tic­u­lar and that is go­ing to be a sig­nif­i­cant prob­lem for many peo­ple in South Africa. It is hap­pen­ing all over the world.”

He said Type 2 di­a­betes used to be al­most non-ex­is­tent with chil­dren and with sug­ary con­sump­tion go­ing up it is be­com­ing more com­mon.

“So what we know is that when a tax like this is adopted it leads to a sig­nif­i­cant in­crease in price and that price in­crease re­duces con­sump­tion. The im­por­tant thing to keep in mind is that it re­ally has the big­gest ef­fect in the most vul­ner­a­ble pop­u­la­tions.”

Chaloupka said di­a­betes had a long-term im­pact and cost a lot of money to treat. He said Mex­ico had adapted quite well to the tax im­pact and has seen a re­duc­tion in con­sump­tion of sug­ary drinks and an in­crease in health­ier op­tions while also gen­er­at­ing sig­nif­i­cant rev­enue for the coun­try’s gov­ern­ment.

One of the ar­gu­ments that comes up all the time is the is­sue of jobs and the im­pact it will have on small busi­nesses. “It is the op­po­site with a tax like this. You would see some job losses in the bev­er­age in­dus­try, but not as bad as the to­bacco in­dus­try.”

Mean­while, the Bev­er­age As­so­ci­a­tion of South Africa (BevSA) wel­comed the de­ci­sion by the World Health Or­gan­i­sa­tion’s (WHO) ex­ec­u­tive board not to en­dorse rec­om­men­da­tions to im­pose a soft drinks tax on mem­ber states.

BevSA’s ex­ec­u­tive di­rec­tor, Ma­pule Ncanywa, said the de­ci­sion was made re­cently dur­ing the ex­ec­u­tive board’s assess­ment of pro­posed cost ef­fec­tive in­ter­ven­tions or “best buys” to ad­dress non-com­mu­ni­ca­ble dis­eases.

“The call by the WHO ex­ec­u­tive board for tech­ni­cal con­sul­ta­tion be­fore the next World Health Assem­bly to re­view stud­ies and doc­u­men­ta­tion in­clud­ing method­ol­ogy fol­lowed by WHO, is aligned with the view of BevSA that a com­pre­hen­sive un­der­stand­ing of the role of su­gar in the over­all diet needs to be in place. BevSA wel­comes the views of those mem­ber states, in­clud­ing Canada, Italy, US and New Zealand, who raised con­cerns and op­po­si­tion over a na­tional soft drinks tax.”

Ncanywa said a su­gar tax would harm the bev­er­ages in­dus­try and South Africa’s eco­nomic growth prospects, while de­liv­er­ing very lim­ited health ben­e­fits.

“BevSA is com­mit­ted to be­ing part of the so­lu­tion to re­duce obe­sity in South Africa. The pro­posed tax on su­gar sweet­ened bev­er­ages will have sub­stan­tial un­in­tended eco­nomic con­se­quences.”


Sug­ary drinks are a sig­nif­i­cant con­trib­u­tor to se­ri­ous health prob­lems, says a dis­tin­guished pro­fes­sor.

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