Currently browsing posts about: Taxes

At the end of December, I received an email from Paula Johns, director of ACT Health Promotion in Brazil.

Today we are celebrating the approval of the tax reform in Brazil. This Tuesday, Dec 17th, the text was approved by the National Congress!!

The tax reform is a historic achievement for Brazil and we celebrate the fact that products harmful to health, such as tobacco, alcohol and sugary drinks, are included in the selective tax. We followed each stage of the discussion and saw the intense lobbying by the economic sector that profits from these products to weaken the selective tax proposal, but it was finally approved, as well as the tax-exempt basic food basket, with healthier products in accordance with the Brazilian Food Guidelines.

…Important to highlight that our National Congress is one of the worst we’ve ever had! To beat The Coca-Cola lobby there is quite an achievement! Wanted to celebrate with you. The inclusion of carbonated drinks in the selective tax now opens the door for a broader discussion about other categories of ultraprocessed foods in the revision that will happen in five years from now.

I also received a press announcement: “Historic Public Health Victory”: Vital Strategies Applauds Brazil’s Approval of Selective Tax on Tobacco, Soft Drinks, and Alcohol

The newly approved legislation includes annual tax adjustments for tobacco, soft drinks and alcohol in line with inflation. Additionally, it establishes an innovative basic food basket of healthy, sustainable products exempt from taxation. The tax reform also grants a 60% reduction in tax rates for horticultural and minimally processed products, nuts, oils, flours, and items from Brazil’s rich socio-biodiversity.  These measures will help ensure better access to nutritious food while discouraging consumption of unhealthy commodities.

…The specific tax rates for tobacco, alcohol, and soft drinks will be determined in 2025. To fully realize the public health benefits of this new tax structure, the levels of tax must be sufficient to reduce consumption. Vital Strategies, Brazil, will collaborate closely with partners to advocate for tax rates that prioritize public health. Setting these rates at levels that significantly reduce consumption of harmful products will protect communities from preventable diseases.

I tried to find more details, and hit upon Covington ‘s Brazil’s historic tax reform: a primer.  This lays out what will have to happen before implementation.  It says almost nothing about the public health taxes except this:

Key Change: the Selective Tax
In addition to the dual VAT (CBS/IBS), the reform establishes a new Selective Tax (IS) to regulate goods and services it characterizes as having significant negative health and environmental externalities. The IS will be charged on production, extraction, sale, or importation of these goods and services.

This will be interesting to watch.  Stay tuned!

The Santa Cruz Sentinal says Measure Z soda tax officially passes in Santa Cruz.

According to the Santa Cruz County Elections Department, 15,780 votes were counted in favor of the ballot initiative, or about 52%, and 14,364 votes, or approximately 48%, were counted against the passage of Measure Z….“Despite being outspent $1.9 million to our $85,000 by corporate special interests, the people of Santa Cruz stood strong and made their voices heard.”

The tax has been a long time coming.  It was first proposed in 2018, but was blocked by a California state act backed by the soda industry which prevented taxes on groceries until 2031.  Lawsuits overturned the penalty provision of the act, which allowed tax proposals to continue.

Politico reviews the history of soda tax fights in California.

Berkeley voted to renew its existing tax, no doubt for these reasons and despite being outspent tenfold.

Research looking at the last decade of Berkeley’s sugary drink tax shows the tax is working: Consumption of sugary drinks dropped by 52% and water increased by 29% among Berkeley residents in diverse neighborhoods with a large proportion of Black and Latino residents. In addition, 16 hydration stations have been installed and $5.7 million has been invested into 18 community gardens at Berkeley Unified School District sites. Funding has also supported vital public health and sustainability programs through organizations like Lifelong Medical Care, Healthy Black Families, The Multicultural Institute, YMCA of the East Bay Early Childhood Impact and The Ecology Center.

The point of all this:

Sugary drinks are the largest source of added sugar in the American diet. The American Heart Association recommends no more than six teaspoons of added sugar per day for women and nine teaspoons for men. One 12-ounce can of sugared soda contains about 10 teaspoons.

The House of Lords Food, Diet and Obesity Committee has a lengthy (179 pages) new report ‘Recipe for health: a plan to fix our broken food system’.

Key finding: Obesity and diet-related disease are public health emergencies costing society billions in healthcare costs and lost productivity.

Key recommendation: The Government should develop a comprehensive, integrated long-term new strategy to fix our food system, underpinned by a new legislative framework.

Key actions (selected):

• Require large food businesses to report on the healthfulness of their products
• Exclude businesses making unhealthful products from policy discussions on food, diet and obesity prevention.
• Tax products high in salt and sugar; use revenues to make healthy food cheaper.
• Ban the advertising of less healthy food across all media.

No recommendation on reducing intake of ultra-processed foods?  Despite finding the link between ultra-processed foods and poor health outcome “alarming,” the report ducked the issue and recommended only to fund more research.

It also advised reviewing dietary guidelines with ultra-processed foods in mind.

Still, the recommendation to keep food businesses out of public policy discussions is a good one, not to mention taxes and advertising bans.

This, mind you, is the House of Lords.  Impressive.

LINKS

• Full report
• News story
• Shorthand version of the report
• Video
• Audio (Baroness Walmsley)

Santa Cruz, a college town on the California coast south of San Francisco, has a ballot initiative to tax sugar-sweetened beverages (Berkeley has one too but its vote is expected to be so favorable that the soda industry isn’t even bothering to fight it).

But the soda industry is sinking a fortune—more than $1.6 million so far—into fighting the Santa Cruz proposal.

The reason is obvious, as Politico explains.

In 2018, industry lobbyists succeeded in pressuring the Legislature to pass a bill banning local governments from enacting new soda taxes for six years.

With next month’s vote, Santa Cruz officials hope theirs will be the first city to attempt to defy that ban by winning voter approval for Measure Z. The two-cent-per-bottle tax is specifically crafted to provoke a lawsuit over the constitutionality of the 2018 state law…Those soda giants are now descending on the Santa Cruz boardwalk with a familiar playbook, relying on seemingly bottomless corporate resources to flood the city with an anti-tax message updated for a new moment in which soda has lost its stranglehold on the American palate.

Do soda taxes discourage purchases?  So it seems.  The money also can be used for good purposes, as it has been in Berkeley.  A win-win for public health!

If you are a Santa Cruz voter, here’s your chance to vote for something that might actually do some good—and an excellent reason to go to the polls and do your overall civic duty, while you are at it.

The Global Health Advocacy Incubator (GHAI) has issued this new report.  It’s well worth a look.

By now, soda taxes are well established to decrease consumption and raise revenues that can be used for social purposes.  As you might imagine, the soda industry does not like such taxes.  As the report explains,

Recently, Big Soda has adapted their [the cigarette industry’s] playbook and shifted their approach from outrightly opposing SB [sugary beverage] taxes to favoring weaker SB tax standards. This report highlights different actions and narratives employed by the industry and demonstrates how these strategies follow a global playbook, including:

1. Proposing weaker taxes tailored to favor industry interests at the risk of public health.

2. Threatening and challenging governments that have passed an SB tax.

3.  Delegitimizing evidence to distort perceptions about SB taxes.

4.  Stigmatizing SB taxes through economic arguments.

5.  Taking advantage of and using vulnerable populations and environmental concerns to avoid the SB tax.

Under Strategy #5, for example, the report provides this information:

The report offers advice about how to counter industry measures by “(1) protecting the tax design to ensure it will have an optimal public health outcome, (2) safeguarding the policy decision-making process from undue influence and (3) leveraging opportunities for civil society to defend SB taxes.

For example, to safeguard policy decisions, it advises:

Avoid participating in public-private partnerships, especially those claiming to mitigate the “economic damages” of the SB tax through false solutions. This is the entry point for corporations to take a seat at the policy-making table and meddle with the design and implementation of the tax.

Soda taxes are up for renewal in Berkeley and are under consideration in Santa Cruz.  Stay tuned.

The World Health Organization has issued guidelines for taxing unhealthy foods: Fiscal Policies to Promote Healthy Diets.

On the basis of current evidence, the WHO recommends:

• Taxes on sugar-sweetened beverages (SSBs)
• Consideration of policies to tax unhealthy foods
• Consideration of policies to subsidize healthy foods

A recent article explains why the recommendation for SSB taxes is so strong: Sweetened Beverage Tax Implementation and Change in Body Mass Index Among Children in Seattle.

• Findings  In this cohort study of 6313 children living in Seattle or a nearby comparison area, a statistically significant reduction in BMI was observed for children in Seattle after the implementation of a sweetened beverage tax compared with well-matched children living in nontaxed comparison areas.
• Meaning  These results suggest that the sweetened beverage tax in Seattle may be associated with a small but reasonable reduction in BMI among children living within the Seattle city limits.

The World Bank is tracking global SSB taxes in a database.

The Global Food Research Program at University of North Carolina also has a database.  It displays the data in maps.

The news here is the recommendation to start working on tax strategies to reduce consumption of unhealthy foods and promote consumption of healthier foods.

Stay tuned!

The UN’s World Health Organization (WHO) has long led efforts to tax unhealthy products, starting with tobacco.

WHO describes its health tax efforts here.

It recently issued Global report on the use of sugar-sweetened beverage taxes, 2023.

The report finds that 108 countries have some kind of tax on sugar-sweetened beverages.

But, it finds

Less than a quarter of countries surveyed account for sugar content when they impose taxes on these non-alcoholic beverage products. Countries with a sufficiently strong tax administrative capacity are encouraged to tax beverages based on sugar content, as it can encourage consumers to substitute with alternatives that have lower sugar content as well as incentivize the industry to reformulate beverages to contain less sugar.

One of its major overall findings:

Among its conclusions are these:

• Existing taxes on SSBs could be further leveraged to decrease affordability and thereby reduce consumption. While other perspectives and competing factors have to be accounted for when designing taxation policies, the protection of health should be a key consideration, particularly considering the health and economic burden associated with obesity and diet-related NCDs.
• This report concludes that excise taxes on SSBs are not currently being used to their fullest potential. Improving tax policy and increasing taxes so that SSBs become less affordable should be pursued more systematically by countries in order to effectively reduce consumption and prevent and control diet-related NCDs, including obesity and dental caries.

Here’s the evidence.  Get to work!

Resoures

• More about WHO’s work on health taxes
• Global report on the use of alcohol taxes, 2023
• WHO technical manual on alcohol tax policy and administration
• Health taxes database

For your calendar today at 6:30 pm EST:

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The World Health Organization has taken a major step: it calls on member countries to tax sugar-sweetened beverages.

“Taxes on sugar-sweetened beverages can be a powerful tool to promote health because they save lives and prevent disease, while advancing health equity and mobilizing revenue for countries that could be used to realize universal health coverage,” said Dr Ruediger Krech, Director of Health Promotion at WHO.

SSB, tobacco, and alcohol taxes have proven to be cost-effective ways of preventing diseases, injuries, and premature mortality. SSB tax can also encourage companies to reformulate their products to reduce sugar content.

More than that, WHO has produced a manual on how to develop and implement SSB taxation policies.

This tax manual is a practical guide for policy-makers and others involved in SSB tax policy development to promote healthy diets and populations. It features summaries and case studies of SSB global taxation evidence, and provides support on the policy-cycle development process to implement SSB taxation — from problem identification and situation analysis through policy design, development and implementation to the monitoring and evaluation phase. Additionally, the manual identifies and debunks industry tactics designed to dissuade policy-makers from implementing these taxes.

SSB taxes can be a win-win-win strategy: a win for public health (and averted health-care costs), a win for government revenue, and a win for health equity.

The manual summarizes everything anyone needs to know to justify taxes and to craft policy.  Get to work!

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