Food taxes – action in Europe and importers. Focus on this new saturated fat tax…\爀屲Meat,...
22
Food taxes – action in Europe Jane Landon, Deputy CEO Wellington, February 2014
-
Upload
truongliem -
Category
Documents
-
view
214 -
download
0
Transcript of Food taxes – action in Europe and importers. Focus on this new saturated fat tax…\爀屲Meat,...
Food taxes – action in Europe
Jane Landon, Deputy CEO Wellington, February 2014
kasloan
Typewritten Text
Big Food Symposium University of Otago, Wellington February 2014
Why look at food taxes now?
• Increasing burdens of chronic diseases • Economic pressures on governments • ‘Deeply dysfunctional’ food systems “Governments have been focusing on increasing calorie availability, but they have been indifferent to what kind of calories are on offer, at what price, to whom they are accessible, and how they are marketed… [countries should] impose taxes on soft drinks (sodas), and on HFSS foods, in order to subsidize access to fruits and vegetables and educational campaigns on healthy diets.” United Nations. Report submitted by
the Special Rapporteur on the right to food, Olivier de Schutter. December 2011. A/HRC/19/59
Presenter
Presentation Notes
“Don’t rule anything out, but let’s look at the evidence and let’s look at the impact on families.” David Cameron comments in context of the obesity epidemic and the burden on UK health services, October 2011. Views from WHO European Region is that less developed countries have shown particular interest in food taxes because disease-related burdens place greater pressure on the economy and they need strategies that do not demand major investment. Wider worries about nutrition security and access to healthy food.
Factors influencing consumer product choice
Source: DEFRA. 2012. Food Statistics Pocket Book 2012.
Presenter
Presentation Notes
Price is increasingly important in driving product choice, with 41% of shoppers naming it as the most important factor and 90% listing it within their top five influences. Promotions are highly influential with 70% listing it in the top 5 factors. Less importance is placed on healthy options, with only 8% of shoppers naming it as the most important influence and only 47% listing it within the top five. More shoppers placed familiarity and taste/smell within their top five factors than healthy options. Brand names still have a sway in many purchase decisions with 33% of shoppers naming in their top 5 influences and 2% as the most important. Ethically produced products were considered least important with 16% of shoppers naming it in their top 5 influences.
The evidence base
• Natural experiments • Modelling studies • Controlled experiments
INDIRECT EVIDENCE • Studies on tobacco and alcohol
Presenter
Presentation Notes
Well documented evidence that as tobacco and alcohol prices are raised by duty increases, so overall consumption decreases. They raise revenues and reduce consumption. Limitations: The possible role of addiction in certain food preferences is not well-understood compared to tobacco or alcohol. There are no substitutions for tobacco or alcohol.
Examples of health related food taxes
Source: Mytton, O. et al. 2012. Taxing unhealthy food and drinks to improve health: An increasing number of countries are introducing taxes on unhealthy food and drinks, but will they improve health? BMJ 2012;344:e2931.
Presenter
Presentation Notes
This list illustrates the limitations of the evidence from natural experiments: Few studies Generally low levels of tax
Examples of health related food taxes
Source: Mytton, O. et al. 2012. Taxing unhealthy food and drinks to improve health: An increasing number of countries are introducing taxes on unhealthy food and drinks, but will they improve health? BMJ 2012;344:e2931.
Presenter
Presentation Notes
Will outline the taxes implemented recently in France, Hungary and Denmark The purpose of the taxes and how they are levied and the reported impacts and reactions (both business and public)
Denmark
Presenter
Presentation Notes
Copenhagen waterfront at Nyhavn…
General tax reform in 2010
• Increase in existing taxes on sugar products, ice cream and sugar-sweetened soft drinks (SSSDs)
• Decrease in existing tax on artificially sweetened soft drinks
• New tax on foods with saturated fat content >2.3g/100g levied on commercial producers in Denmark and importers.
Presenter
Presentation Notes
Focus on this new saturated fat tax… Meat, dairy (excluding drinking milk), animal fats, edible oils and fats, margarine and spreadable blended fats. Increases cost of a pack of butter by about 20% Meat products – smaller increase – about 12 cents to a kilo of minced beef.
Effect of Denmark fat tax on consumption of fat and oils – preliminary estimates
Source: Jensen, J. Presentation to the National Heart Forum. 29 June 2012.
Presenter
Presentation Notes
Based on household expenditure data and econometric analysis of purchases and prices before and after the tax.
Change in fat product prices in Denmark post-tax
Source: Jenson, J. Presentation to the National Heart Forum. 29 June 2012.
Presenter
Presentation Notes
Compare the blue – predicted price changes with actual price changes. Note the difference between supermarkets and discount stores (which show a profit-maximising response). How much has this tax raised? Estimated annual revenues of DKK 1.5bn (£106m). The intended purpose was revenue raising rather than public health reasons. The sat fat tax is currently under serious threat. It has faced fierce lobbying from the meat and dairy sectors. Public support is probably low, especially compared to the other taxes (sugar products, ice cream etc). It is proposed that it is abolished but this won’t happen until alternative revenues or budget savings replace it. There are planned proposals in Denmark to broaden the tax base for sugar taxation to more products.
France
Presenter
Presentation Notes
Champs de Mars, Paris….
French Finance Law 2012
• Tax on soft drinks (sugar-sweetened and ‘diet’ drinks)
• Explicit purpose: to raise revenues (for National Social Health Insurance and for general purposes)
• But, aligned with National Nutrition & Health Programme (2011-2015)
• Levied on drinks manufacturers, importers and food service outlets at €7.16/hectolitre (£5.66)
Presenter
Presentation Notes
Nutritional objectives include reducing the proportion of children drinking more than one glass of sugary drinks per day by at least 25% Nutrient based tax would be difficult to introduce under this French Law – hence category-based tax.
Econometric modelling of the impact of the tax on consumption using data from 2003-2005 Excluding drinks purchased outside the home
Drinks with added sugars All soft drinks Price % Consumption
(litre) Consumption sugar added (grams)
Price % Consumption (litre)
Consumption sugar added (grams)
Drinks with added sugars
12.7 -4.1 -242 12.1 -3.0 -131
National brands
9.4 -2.5 -150 8.6 -1.5 -53
Retailer brands
19 -1.6 -92 18.9 -1.5 -78
Drinks with sweeteners
-1.7 +1.2 1.2 -0.4
Total 8.7 -2.9 -242 11 -3.4 -131
Source: C Bonnet. Toulouse School of Economics.
Presenter
Presentation Notes
Greatest price increases on cheapest, own brand drinks. Industry analysis data suggests soft drink sales fell by 3.3% between 1 Jan and 31 May following a 5% increase in soft drink prices (double the price increase seen in other food prices). Public reaction? Generally accept that soft drinks are not a healthy option and do not question the tax. Industry reaction? Strong objection to any suggestion that this was a public health measure – ‘sanctions our business and stigmatises our products’. (Coca Cola). Govt agreed not to refer to public health as a motivation…
Econometric modelling of the impact of the tax on consumption using data from 2003-2005 Excluding drinks purchased outside the home
Drinks with added sugars All soft drinks Price % Consumption
(litre) Consumption sugar added (grams)
Price % Consumption (litre)
Consumption sugar added (grams)
Drinks with added sugars
12.7 -4.1 -242 12.1 -3.0 -131
National brands
9.4 -2.5 -150 8.6 -1.5 -53
Retailer brands
19 -1.6 -92 18.9 -1.5 -78
Drinks with sweeteners
-1.7 +1.2 1.2 -0.4
Total 8.7 -2.9 -242 11 -3.4 -131
Source: C Bonnet. Toulouse School of Economics.
Presenter
Presentation Notes
Greatest price increases on cheapest, own brand drinks. Industry analysis data suggests soft drink sales fell by 3.3% between 1 Jan and 31 May following a 5% increase in soft drink prices (double the price increase seen in other food prices). Public reaction? Generally accept that soft drinks are not a healthy option and do not question the tax. Industry reaction? Strong objection to any suggestion that this was a public health measure – ‘sanctions our business and stigmatises our products’. (Coca Cola). Govt agreed not to refer to public health as a motivation…
Hungary
Presenter
Presentation Notes
Chain bridge over the Danube…
Public Health Product Tax, 2011 • Tax on pre-packed products where healthy
alternatives are available • Explicit aim to promote healthier consumption and
stimulate reformulation. • Revenues to support health purposes. • Tax is levied on domestic producers and domestic
seller of imported goods. • Political background – limited health resources,
‘unorthodox’ fiscal policies and government willingness to regulate multinationals as necessary.
Presenter
Presentation Notes
Also known as the ‘chips tax’ as it was originally applied to fast food, potato crisps and bakery products.
Hungary Example: Rate of tax applied to foods in Hungary (shown in Hungarian Forints and GBP)
Category From September 2011 From January 2012 Soft drinks Added sugar >8g/100ml
5 Ft/litre (1.4p/l) Syrups or concentrates for soft drinks 200 Ft/l (54p/l) Other soft drinks 7Ft/l (1.9p/l) Drinks with >25% fruit content exempted.
Energy drinks Added caffeine >10mg/100ml 250 Ft/l (68p/l)
Methylxanthines content >1mg/100ml Taurine>100mg/100ml
Confectionery Added sugar >25g/100g Chocolates: >40g/100g 100Ft/kg (27p/kg)
Added and total sugar >25g/100g Chocolate: added and total sugar >40g/100g and cocoa content <40g/100g 70Ft/kg – sweetened cocoa powder (19p/kg) 130Ft/kg all other products (36p/kg)
Salty snacks Salt >1g/100g
200Ft/kg (54p/kg)
250 Ft/kg (68p/kg)
Condiments Salt >5g/100g (exemptions for mustard and ketchup) 200 Ft/kg (54p/kg)
250 Ft/kg (68p/kg)
Flavoured beers/alcopops Beer or any other alcohol with added sugar that has total sugar content >5g/100ml 20 Ft/l (5.4p/l)
Fruit jam All fruit flavours except extra jam, extra jelly, marmalade and special quality jams 500 Ft/kg (1.37/kg)
Presenter
Presentation Notes
Difficult to assess the impacts of the taxes: Drop in sales of salted snacks and soft drinks difficult to disentangle from effects of economic crisis in Hungary Effect of stockpiling before the tax was implemented Lower revenue collections than expected – probable tax evasion Some evidence of reformulation, although not necessarily ‘healthy substitutions – energy drinks Industry reaction – highly critical. Feel that the measure is ‘unwarranted’. Public reaction – view as revenue raising exercise – sceptical of its success
Ireland
Presenter
Presentation Notes
River Liffey in Dublin
Effect of soda tax on obesity • Modelling study of 10% tax on sugar-sweetened
beverages in Ireland • Estimated to result in mean reduction in energy
intake of 2.1kcal/person/day • Predicted to reduce the percentage of the obese
adult population by 1.3% • Conclusion: Small but meaningful effect on obesity
Briggs A et al. BMC Public Health 2013
Presenter
Presentation Notes
Also known as the ‘chips tax’ as it was originally applied to fast food, potato crisps and bakery products.
UKHF Symposium: Summary of recommendations
1. Taxes should be part of a package of public health policies. 2. Excise duties offer flexibility, control and focus of the tax
instrument. 3. Taxes applied to specific categories, such as sugar-sweetened soft
drinks, are easiest to apply and have fewer unintended effects. 4. Elasticity analysis and modelling to identify potential unintended
consequences.. 5. Concerns about regressivity must be taken into account, but
should not be used as barriers to implementing taxes. 6. Clear communication of the purpose of a tax and its potential
benefits, including how revenues may be used to support health programmes or subsidise healthy foods will determine public acceptance of the tax.
7. Any statutory instrument should have a ‘sunset clause’ so it is subject to review after a period of time.
