Mexico Could Double its Sugar Tax as World Wonders if Soft Drinks Levy Actually Cuts Obesity

In recent months there has been much debate over whether or not Mexico’s sugar tax has led to a fall in obesity statistics, particularly the direct impact the levy has had on consumers and the market.

After an initial drop, domestic sales of soft drinks have reportedly recovered leading to renewed calls from sugar tax advocates to increase the levy. In short, the sugar tax has not necessarily stopped Mexicans from buying sugar-packed sodas.

 

It was first introduced in January 2014 as Mexican authorities wanted to tackle the country’s escalating obesity crisis. Mexico implemented an excise tax of one peso/L on sugar sweetened beverages. It has raised more than US$2 billion since being introduced.

 

Mexico has one of the highest prevalence rates for diabetes, overweight, and obesity in the world. The government’s introduction of the sugar tax is seen as an important target to curb obesity and related health problems, whilst encouraging the soft drinks industry to reformulate beverages with reduced sugar levels and alternative ingredients.

 

Mexican senator Armando Rios Piter is reportedly arguing for higher tax to fund better provision of drinkable water and is leading the charge to double sugar tax on soft drinks.

 

Mexico is often looked at as a model by other countries considering introducing their own levies on sugar-sweetened soft drinks. Countries such as Australia, Colombia, Ireland, India, Indonesia and South Africa are debating introducing similar taxes.

 

Yesterday the UK finally published its Childhood Obesity Plan which includes a 20 percent sugar tax. While the soft drinks industry believes it’s too tough, public health organizations think it does not go far enough.

 

Opinion is polarized in many of the countries where sugar tax has been implemented or being planned.

 

The major soft drink producers consider food-based “sin” taxes regressive, claim they do little to tackle obesity and have a disproportionate impact on low-income households.

 

Drinking sugar-loaded soda has been part of Mexican culture for many years with canned or bottled soft drinks the commonplace accompaniment to street food like tacos, which are sold from morning until night in many Mexican regions.

 

The Coca-Cola company first began bottling sodas in Mexico in the early 1920s and a few years later the first Coca-Cola vending machines were installed in Mexico City. Even the country’s 55th president, Vicente Fox, was the former head of Coca-Cola Mexico before he took up office in 2000.