Sugar tax: a health sweetener


A 20% TAX ON SOFT DRINKS WOULD RESULT IN WIDESPREAD, LONG-LASTING PUBLIC HEALTH BENEFITS AND SIGNIFICANT HEALTH COST SAVINGS, A NEW STUDY SHOWS.

University of Queensland School of Public Health researcher Dr Lennert Veerman say the tax would raise an estimated $400m and reduce annual health expenditure by up to $29m.

“Our modelling scoped the effects over the lifetime of adult Australians alive in 2010,” Dr Veerman says.

“We found there would be 800 fewer new type 2 diabetes cases each year once the tax was introduced.

“After 25 years, about 1600 fewer deaths would occur each year, with heart disease accounting for the largest share of this postponed mortality,” he said.

“There would be 4400 fewer people with heart disease at that time and 1100 fewer people living with the consequences of stroke.”

“In effect, Australians would enjoy about 170,000 healthy life years that they would not have otherwise.”

Fruit juices, fruit drinks, energy drinks, milk-based drinks and cordials were excluded in the study which focused on soft drinks with added sugar.

Dr Veerman says overall health care cost savings would rise over the first 20 years of the tax and then stabilise at about $29m a year.

Previous studies showed that a 20% tax (based on product price rather than on the amount of sugar in the product) could reduce total energy consumption by about 10,000kJ per person per year.

“Policymakers have cited limited available evidence as a barrier to policy progress in the area of taxes on unhealthy foods, so we expect the detail in our study will be useful to them,” Dr Veerman says.

UQ worked on the study with the World Health Organization Collaborating Centre for Obesity Prevention at Deakin University, and Victoria’s Obesity Policy Coalition.

Obesity Policy Coalition executive nanager and study co-author Jane Martin says sugary drinks were the largest source of added sugar in Australian children’s diets. She says given that 1-in-4 children and almost 70% of adults are overweight or obese decisive action by government was needed.

She also cites Australian research which demonstrates that two thirds of respondents wanted a tax on soft drinks if the money was used to reduce the cost of healthy food.

The cost to government of implementing the tax is estimated at $27.6m but Dr Veerman says reduced healthcare expenditure would pay back the cost of legislation and monitoring the tax more than 14 times.

“The greatest effects are likely to be seen in young people, who are the highest sugary drinks consumers.

“A sugary drinks tax is not currently on the political agenda in Australia, but this study and international experience suggest it should be considered as part of any tax reform process.”

The research is published in PLOS ONE.

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