Sugar taxes ineffective, proves new study
A new report based on real-world examples by the prestigious UK-based think tank Institute for Economic Affairs demonstrates that sugar taxes are ineffective, regressive and inefficient.
The main findings confirm what many other studies have already shown, in particular:
- The demand for sugary drinks, snacks and fatty foods is inelastic: evidence demonstrates that most people will not change their food shopping habits unless prices change dramatically
- Consumers respond by substituting taxed food and drinks with cheaper brands of the same products or with similar non-taxed products. This behaviour leads to the consumption of potentially inferior goods rather than the consumption of fewer calories
- Consumers tend to switch from taxed sugary drinks to other high calorie drinks such as fruit juice, milk or alcohol
- Food taxes are highly regressive and severely hit low income households because energy-dense food and soft drinks take a greater share of their earnings than that of higher income households
- Most notably, no impact on health has ever been found
Asked to comment on the report, Chris Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs, said that the effectiveness of sugar taxes as health measures lack “any real world evidence”.
“It’s high time this policy [taxing sugar] is put to bed” – he concluded.