Getting to the Sweet Spot –It’s Time to Tax Sugary Drinks

Last week, BCAHL had a great opportunity to meet up with health leaders from Mexico and Barbados and hear about how they were able to build support for a Sugary Drink Tax.

Both countries were wrestling to control the health complications and costs (especially from type 2 diabetes and hypertension) that have developed alongside growing rates of obesity.

Health advocates in Mexico were able to build public support for a tax on sugary drinks by making connections between sugary drinks and the negative health impacts of obesity and type 2 diabetes. They also showed how the tax could be used to fund health initiatives – such as funding for water fountains in schools and public spaces.

Mexicans have the dubious distinction of having the highest obesity rates AND drinking the most sugary drinks – in the world. In fact, in Mexico 70% of adults and one-third of children are at an unhealthy weight. Type 2 diabetes takes the lives of 70,000 people per year and 14% of adults live with it. This along with the high costs of medical treatment made a compelling case for politicians to “do something.”

On January 1, 2014, Mexico brought in a special tax on sugary drinks of one peso per liter, which is roughly equivalent to a 10% increase in price.

And it is working!

According to one report, by the end of 2014, there was a 12% decline in purchases and the lowest income group have reduced consumption by 17%. This happened despite aggressive marketing by companies and that consumption had risen dramatically in the preceding years (up 60% between 1989 & 2006).

In Barbados, the decision was made by the government, prompted by a report from the International Monetary Fund (IMF). The IMF report recommended a sugary drink tax for generating revenues from a product that has no benefit to the public and only adds costs for the health system.

Industry is obviously not happy about this. In Barbados, first the regional director and then the CEO of a very large and well-known cola company came in to try and change the minds of the local politicians but they held firm. Our international colleagues warned us that we could expect to see tactics similar to those used by big tobacco. First they attack the evidence, when that doesn’t work, they warn of all the job losses and if that doesn’t work then they attack the messenger (by smearing the organizations advancing taxation).

Sometimes it just feels like the time for an issue has come – there is usually much work that goes on in advance but all of a sudden there is attention on the issue and support and then that beautiful ‘tipping point’.

This fall, there was much in the media when the Canadian Diabetes Association included Sugary Drink Taxation as one of their top issues in the federal election campaign.

We’ve also been encouraged by the recommendation by the Standing Committee on Finance and Government Services to “explore the feasibility of a sugary drink tax”in their report on the budget consultations for this year. And just at the end of November, the UK Standing Committee on Health recommended a sugary drink tax as part of an overall strategy to tackle childhood obesity.

In BC, the Childhood Obesity Foundation has estimated we could potentially raise approximately $150 million per year[1]. Imagine the amazing health programs that might fund.

I may be an optimist but it’s starting to feel like the issue of Sugary Drink Taxation has been gathering momentum and we are approaching that sweet spot. What do you think? Would you support a tax on sugary drinks if you knew the funds were being used to support health initiatives?

Rita Koutsodimos
Manager, Advocacy and Communications
December 2015

[1] This is based on a modest estimate of per capita consumption at 110 litres/person/year, taxed at 30₵ per litre

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