Food taxes are regressive – they affect the least well-off the most
Food and non-alcoholic beverages are not luxury goods. They are widely produced, broadly consumed products and generally account for an important share of the family budget of low- and middle-income consumers. As lower-income consumers spend a greater proportion of their income on food and non-alcoholic beverages than wealthier consumers, a tax that raises the price of these products would disproportionately hit the living standards of lower-income households.
Taxation is just one side of the coin
The cost of food is a key determinant to dietary patterns. Research confirms that food prices explain why poorer segments of the population have less healthy diets. According to the Eurobarometer lack of access, (un)availability, and financial constraints present a significant barrier to a healthy lifestyle among the lower socio-economic groups. Moreover, lower socio-economic groups often have lower physical activity levels, with increased levels of TV watching and sedentary activities combined with lower access to leisure facilities. Statistics reveal that one third of European citizens believe that it is not easy for them to eat a healthy diet – confirming that the affordability of goods that are necessary for a healthy diet is a critical challenge. A more appropriate and useful solution to solve the obesity pandemic would be to increase subsidies to the production of fruit and vegetables that give the necessary nutrients for a balanced lifestyle. Find below a selection of relevant studies and media articles on the disproportionate impact of food and drink taxes on low- and middle-income earners: