Denmark’s fat tax is a real-world experiment that could help shape obesity prevention policies here in Australia, and potentially sweeten the palate for a soft drink tax.
Our obesity crisis is only set to worsen with one quarter of children overweight or obese, and more than 60% of adults falling into these categories. We live in an increasingly obesogenic environment where the availability of cheap, tasty and highly calorific food is having a major impact on rates of chronic diseases such as cancer, heart disease and diabetes.
The decision by Denmark to tax all products containing more than 2.3% saturated fat is bold indeed. Rarely do we get to see such policies played out in the real world and the opportunities to learn from this are very promising.
Taxation is always contentious and certainly it’s not a measure that should be applied lightly or in isolation. Obesity is a complex issue that requires a comprehensive approach addressing pricing, marketing, availability, labelling and education. However, we do know that tax works — food pricing has the capacity to shift consumer preferences towards healthier options, thereby improving public health outcomes.
Here in Australia important lessons can be learned from the impact of taxes on alcohol and tobacco. In both cases, increases in real prices have had the effect of reducing consumption, particularly among young people and adults with low income.
Deciding what to tax is fraught with debate. Denmark’s decision to focus on saturated fat was made after an examination of data on diets but there has been some disagreement as to whether this could work here in Australia.
Another option would be to identify the foods that contribute most to overweight and obesity. There is extensive evidence of a strong association between sugar-sweetened beverage consumption and BMI, overweight and obesity (among adults and children). And with no nutritional value whatsoever and high consumption it seems ripe for taxation — certainly evidence is emerging that price influences soft drink consumption. It has been estimated for example that a 10% increase in soft drink prices could reduce consumption by 8-10%. It has also been estimated that a 20% tax would reduce body weight by 0.7 to 1.2kg per year.
Of course the fear with a “fat tax” is that you target those who can least afford it — the highest consumers of unhealthy food and sugar sweetened soft drink are young people and those on low incomes.
That’s why any tax must be balanced with a subsidy on healthy food. The subsidy may apply to reduce the cost of fruit and vegetables to all consumers, or take the form of vouchers (similar to Food Stamps in the US) could be provided to low-income earners to purchase a basket of healthy foods each week. Subsiding healthy food would not only change behaviour, but would protect and improve levels of food security among lower socio-economic groups.
The National Preventative Health Task Force has recommended the government investigate options for taxing unhealthy foods and subsidising healthy foods.
Whatever lessons we learn from Denmark in the long-term that fact is a comprehensive review of taxation as it relates to food is overdue, and should be investigated as a priority.
*Jane Martin is senior policy adviser for the Obesity Policy Coalition
Great idea! Let’s give young, poor fatties a food voucher, thus labelling them as …
Young,
Poor and
Fat.
This will do wonders for their self-esteem.
Why not increase the social support which is provided seamlessly and privately to this segment of the population? Back this up with education and restrictions on advertising, or by support for school canteens and breakfast clubs (which provide a basic meal for those who arrive at school without having eaten).
Whether or not to have sugar and fat taxes should depend on whether or not these measures are found to be effective, not as a means to financially punish and then publicly humiliate via vouchers those whose physical health you seek to improve, while ignoring their emotional and financial health.
It’s somewhat akin to “The floggings will continue until morale improves”.
Any chance of transfer pricing? Tax the crap (a simple sugar/fat ration would suffice) and use the proceeds to subsidise real food (again simple 0 the leasst processed). Worked with ULP, so why not with gulp?
I see cartons of giant bottles of coke walking out of super markets so cost is not the factor. What irks me is that these sugar peddlers use so much precious water to poison us.
Nonetheless a heavy tax is called for with subsidies for healthier foods.
Give us a break, please. Writing this patronising pap may make you and your fellow goody two shoes public health lobby fellow travellers feel superior to the rest of us, but have you thought of advocating that people be left to make their own choices? Oh yes, sorry, I forgot that your lobby doesn’t trust people to do the right thing by themselves, does it?
Have just seen some 2010 American survey evidence that more than 8 out of 10 American employees know and understand the importance of diet and exercise in reducing health risks, and I’m sure that it’s much the same in Australia. You can trust people to do the right thing with balanced information like your own group’s labelling traffic lights, and don’t have to tax people’s goolies off just to make a policy elite feel smug about themselves. If they don’t look after themselves, reckless and feckless individuals can front the consequences of their choices. It’s called taking responsibility.
Will it be plain-packaged soft drink bottles next?
And as for “obesogenic” (what an ugly word!) culture – exercise is free, why don’t you advocate that? Modest public investments in, for example, more bike paths, recreational reserves, swings and monkey bars, and promoting organised sport (without the shadow of volunteer clubs being sued pantsless if little Joannie skins her knee) would do far more for reducing body weight than any fat tax, and pay for themselves over time in lower care costs.
No come to think of it, maybe it wouldn’t, as muscle weighs more than fat! So a healthier population could well be, on average, heavier. So heavier is good! QED.
Oh please. We have only just finished the tax forum – partly about simplifying the tax structure.
Surely the best way to deal with the problem is to tax the obese directly? Maybe top tax rate could match your BMI.