In 2017, the Argentinian government proposed a modification in the country’s taxation that would have increased the tax on sugar-sweetened beverages from 4% to 17%. This tax modification was not accepted as congress denied this possibility, due to the pressure that the Government of Tucuman and its congressmen put on the measure as they represent the province with the highest production of sugar in Argentina.
But looking at the percentage of obese and overweight people in Argentina, and the associated non-communicable diseases (NCDs), wouldn’t it be beneficial to have a “soda tax”?
To answer this question, it is important to note that for this publication we’re examining the problem from a public health perspective. Also, a preliminary question to answer is if there is evidence that the measure has a positive effect on public health, and indeed there is.
Both WHO and PAHO, evidence-based, are promoting the implementation of taxes on sugar-sweetened beverages to fight the pandemic of overweight, obesity and related diseases.
In Mexico, more than 70% of the population is overweight or obese. As a result, in 2014, a tax on sugar-sweetened beverages was approved. In a study carried out by the University of North Carolina in conjunction with Mexico’s NationalInstitute of Public Health, they found a 5.5% decrease in consumption in the first year and 9.7% in the second year after implementation of the tax. The greatest changes are seen mainly in the low-income sectors, where there is an even greater reduction: 9% in the first year and 14% in the second. The effect in terms of impact on the health of the population has not yet been measured since a longer period of time it is needed.
The most important point for the tax to work is the price change, as this should decrease the consumption, but it’s not always so easy. The increased tax percentage is not always reflected in the final consumer price, companies try to reduce supply chain costs to try to keep the consumer price from going up in the same magnitude. That is why the tax should be high enough to be reflected in the price, in order to effectively to decrease sales. The price increase must be significant to the consumer’s pocket.
Argentina needs to take measures that will help reduce dietary problems – and the NCDs that come with them – and the consumption of sugary drinks is strongly associated with a higher incidence of these diseases. In conclusion, it would probably be beneficial, seeing the example of Mexico, for the public health of the country to have a soda tax.
The views reflected in this expert column are those of the individual authors and do not necessarily represent those of the O’Neill Institute for National and Global Health Law or Georgetown University. This blog is solely informational in nature, and not intended as a substitute for competent legal advice from a licensed and retained attorney in your state or country.