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Mexico's New National Soda Tax: A Test Case for Anti-Obesity Policies

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Last month in an effort to stem its soaring obesity rates, Mexico took bold public health action and passed a new soda and junk food tax. Beginning on January 1, 2014, Mexico will impose a national tax of one peso per liter (about 10 percent) on sugar-sweetened beverages and 8 percent on junk food. The junk food tax applies to foods that contain more than 275 calories per 100 grams, excluding meat, dairy and other “real foods”.  Although Mexico’s Constitution does not allow for “earmarks” or tax revenues for specific purposes, there is preliminary agreement that much of the money will be allocated for public health, including a pending $270 million initiative to install drinking fountains that dispense purified water in all schools. This new law is a considerable feat in a country that consumes more soda per capita than any in the world and where the former president had been the top executive for the Latin-American arm of Coca-Cola. Indeed, 30% of people in Mexico are obese and the country recently surpassed the United States as the most obese nation in the world.

Civil society, namely the Nutritional Health Alliance of 22 NGOs and networks representing 650 nonprofits and grass-roots organizations, played a key role in the success of the groundbreaking legislation. Bloomberg Philanthropies, Michael Bloomberg’s foundation, assisted by committing $10 million to support anti-obesity advertising campaigns, finance research and promote anti-obesity policies like the soda tax. However, the proposed legislation faced considerable challenges. Industry lobbied aggressively against the law and television stations refused to air advertising in favor of the soda tax, while running a number of ads from industry opponents. Critics even went so far as to brand the proposals “The Bloomberg Tax” and urged Mexicans to fight “foreign intervention”.

The Mexican law will provide a rare test case of a national soda tax directed at a severe obesity problem. Although the landmark law is a significant public health intervention, it will be important to bear in mind that taxes are but one of many available interventions that can be used to address the obesity epidemic – and they may work best in combination. As O’Neill Institute Faculty Director, Lawrence Gostin writes “critics demand that each intervention be proven in isolation, but the more rational question is whether a suite of polices has a reasonable chance of working. Tobacco policies, for example, have dramatically reduced smoking over several decades. But we have great difficulty measuring the efficacy of any single intervention.” The Mexican soda tax is one step towards trying to slow this epidemic of preventable disease, and it will hopefully spur a range of policies that will work in combination to make it easier for people to lead healthier lives.

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