The World Health Organization (WHO) has published an October 2016
report claiming that “taxing sugary drinks can lower consumption and
reduce obesity, type 2 diabetes and tooth decay,” according to a concurrent
press release. Titled Fiscal Policies for Diet and Prevention of
Noncommunicable Diseases (NCDs), the report collates information
gathered during a May 2015 technical meeting of fiscal-policy experts
who evidently concluded that “there is reasonable and increasing
evidence that appropriately designed taxes on sugar-sweetened beverages
would result in proportional reductions in consumption, especially if
aimed at raising the retail price by 20% or more.”

The report summarizes the effect of fiscal policies—including food
and beverage taxes, nutrient-focused taxes and subsidies—on health
outcomes in Denmark, Ecuador, Egypt, Finland, France, Hungary,
Mauritius, Mexico, Philippines, Thailand and the United States. “Some
of the challenges faced in implementation include a lack of appropriate
capacity for tax administration, tax set at low levels that prove inefficient
in influencing behavioral choices, and a lack of monitoring and evaluation
of the health impact,” notes the report. “It was established from all
presentations that countries attempting to progress fiscal policies face
considerable political and industry opposition.”

Among other things, WHO recommends that countries considering the
use of fiscal policies to affect diet first need to determine (i) the type and
structure of the tax, (ii) what products to tax, and (iii) the implications
for nutrition-related programming. The organization also draws parallels
to tobacco taxation, arguing for “specific excise taxes” adjusted to
inflation and income “to effectively reduce affordability and discourage
consumption over time.” The report adds, “Similarly strong evidence
shows that subsidies for fresh fruits and vegetables, that reduce prices
by 10–30%, are effective in increasing fruit and vegetable consumption…
Taxation of other target foods and beverages, particularly those high in
saturated fats, trans fatty acids, free sugars and/or salt appears promising,
with existing evidence clearly showing that increases in the prices
of target options reduces their consumption.”


Issue 619

About The Author


For decades, manufacturers, distributors and retailers at every link in the food chain have come to Shook, Hardy & Bacon to partner with a legal team that understands the issues they face in today's evolving food production industry. Shook attorneys work with some of the world's largest food, beverage and agribusiness companies to establish preventative measures, conduct internal audits, develop public relations strategies, and advance tort reform initiatives.

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