health impact of taxes on foods high in fat, sugar, salt...what are taxes aimed at? •tax as a...
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Health Impact of Taxes
on Foods High in Fat, Sugar, Salt
Franco Sassi PhD Imperial College London
WHO, Geneva, 4th-5th December 2017
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What Are Taxes Aimed at?
• Tax as a signal to consumers and industry
• Reduce the consumption of a specific product
• Improve health by improving dietary quality
• “research on the overall nutritional quality of purchases is mixed
because of substitution effects” (Epstein et al. 2012)
• “Food substitutions are difficult to investigate and predict, and they
may hinder the effectiveness of taxes when the latter are not
carefully designed.” (Hawkes and Sassi, 2015)
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Taxing Fat
• UK – “negligible” effects (Tiffin and Arnoult, 2011)
• France – “small and ambiguous” effects (Allais et al., 2010)
• Potential unwarranted substitutions:
o Increased sugar intake (Jensen and Smed, 2007)
o Increased salt intake (Mytton et al., 2007)
• Politically difficult and controversial:
o Hits products viewed as basic components of diet (meat, dairy, etc.)
o How bad is fat?
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The Danish Saturated Fat Tax 2011-12
• Reduction in saturated fat intake from beef by 1.4% (with
increased consumption of low- and medium-fat cuts), and from
cream by 11.3% (Jensen et al., 2014)
• Overall intake of saturated fat reduced by 4% (Smed et al., 2016), along
with increased consumption of vegetables and salt, leading to a
0.4% reduction in all deaths from NCDs (modelled)
• Estimates of change in IHD risk vary from +0.2% to -0.3% (Bødker et
al., 2015)
• Lack of scientific consensus on health value of the tax key reason
behind repeal (Holm et al., University of Copenhagen)
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Fat Taxes Work Best when Coupled with Subsidies
• Review of effects of population-level subsidies (Thow et al., 2010)
• Review of model-based studies (Eyles et al., 2012)
• Subsidy component has larger effect than tax component (Tiffin and
Arnoult, 2011)
• But is also more regressive (Lacroix et al., 2010)
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Health Outcomes of Combined Tax and Subsidy (Cecchini et al., 2010)
Mass media camp
Worksite interv.
Physician couns.
School-based int.
Food labelling
Fiscal measures
Food advert reg.
Life years (thousands)
China India Brazil Russian Federation England Mexico South Africa
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Combined Taxes and Subsidies: Distributional Impacts
0.0%
0.1%
0.2%
0.3%
0.4%
0.5%
0.6%
0.7%
high SES low SES
Disadvantaged socio-
economic groups will
benefit the most in health
terms because:
a) they are more price
responsive
b) they have a larger
prevalence of chronic
diseases and risk factors
DALYs Saved by Age Group
Source: OECD Health Working Paper 48.
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Do Subsidies Alone Work?
• Good evidence on fruit and vegetable subsidies
• Sweden – wholegrain subsidies lead to increased intake, but
mostly in existing consumers, and also increased consumption of
salt and fat (Nordström and Thunström 2009, 2011)
• Risks in subsidising foods or nutrients:
o Increase in overall calorie intake
o Increase in unhealthy nutrient intake
o Unwarranted change in the overall balance of macro-nutrients
• Product subsidies vs. welfare subsidies – evidence of perverse
effects of food stamps in US
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Taxing Energy or Energy Density
• Calorie tax – modelled, but never tried in practice; most efficient
option (Okrent and Alston, 2012), but not always most effective
• Several countries have taxed energy-dense, “non-essential”, or
“nutrient-poor” foods (e.g. Hungary, Finland, Mexico and others)
• Hungary evaluations positive, but largely qualitative and based on
surveys (self-reports) – the tax has led to substitutions towards
healthier products and product reformulation by manufacturers
• Mexico early evidence – consumption of taxed foods reduced by
5.1% relative to expected levels (-10.2% for low-SES households) in
the first year (Batis et al., 2016)
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Taxing Energy or Energy Density
• Fast food prices leading determinant of adolescent body weight (Powell
et al., 2006)
• Price elasticity of fast food consumption -0.52 (Powell et al., 2012)
• Significant body of research based on laboratory choice experiments:
evidence that price incentives can improve overall nutritional quality
of food choices, but highly dependent on substitutions
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Can we Tax based on Nutrient Profiles?
• Increasing focus on nutrient profiling to improve overall dietary
quality
• Studies combining nutrient profiles for different foods into an overall
score for diets show some degree of correlation with health
outcomes, but variable for different outcomes (Julia et al.)
• Norfolk EPIC study: no correlation of overall dietary score with CVD
and other health outcomes (Rayner et al.)
• Challenges in tax administration and political acceptability (industry,
trade organisations)
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Conclusions
• Taxes on food and non-alcoholic beverages can:
o Give a signal to consumers and manufacturers
o Reduce consumption of taxed product
• So, they should focus on products that can be singled out as
unhealthy and of no or limited nutritional value
• Using taxes to improve nutritional quality of overall diet is much more
challenging, and we may not have the tools and the political drive
required to do it today