March 8, 2024
📰 FEATURE STORY
Will a tax on junk food help combat obesity in India?
A craving for junk food is nothing unusual. Everyone craves it every so often, even though we know it’s not good for our health. But we just can’t stop ourselves. Given its high sugar, salt, and fat content, its “side effects” have been known for a while now. Cumulatively, it leads to more people becoming overweight or obese.
A recent Lancet study stated that obesity, particularly among young children, has increased manifold in India. There’s a clear and urgent need to combat this health crisis. While just asking people to eat healthy and exercise might not be the trick, taxing junk food might dissuade people from opting for junk food. Could this be the answer?
Context
Let’s first define obesity. It’s defined by the World Health Organisation (WHO) as an abnormal or excessive accumulation of fat that poses health risks. Someone with a Body Mass Index (BMI) of over 25 is regarded as overweight, and over 30 is obese. Now, it should be said that BMI is a divisive metric and has been criticised for not being accurate or a true reflection of one’s health. We’ve tackled that issue here.
The Lancet report stated 12.5 million children between the ages of 5 and 19 were grossly overweight in 2022. That’s an increase from 0.4 million in 1990. Among adults, obesity has increased sharply in women, with a 9.6% prevalence. That’s an 8.6% increase from 1990. For men, it was 5.4%, an increase of 4.9 percentage points.
All of this is bad news for India, considering there’s already a high burden of non-communicable diseases like heart disease, stroke, and diabetes. What’s the cause? It does seem obvious – dietary changes. Some nutritionists state that people have moved toward a diet high in energy but low in nutritional value. People are consuming more refined carbohydrates, meat products, and processed foods. Junk food is among the biggest culprits with its high fat, salt, and sugar content.
The other aspect is people aren’t moving that much. Sedentary lifestyles have increased sharply over the past several decades. The rise in obesity among children is particularly concerning, given this aspect. The study also shed light on the fact that more women were prone than men. It’s probably because they have less time and access to physical activity.
Countries have recognised the need to combat obesity. At the 75th World Health Assembly in 2022, member states adopted new recommendations to prevent and manage obesity. They endorsed the WHO Acceleration Plan to Stop Obesity. Many countries decided to mandate companies display nutrition facts on most packaged foods.
In India, per the Food Safety and Standards (Packaging and Labelling) Regulations, restaurants with a central license or outlets with at least ten locations should display the caloric content of their food on menus.
One step that has been considered is making junk food cost more by levying a tax on them. They’re sometimes called “corrective taxes”. In some countries, it was through taxing sugary drinks like the Soft Drinks Industry Levy or “sugar tax” in the UK in 2018. Other countries have done something similar on junk food. Would it yield the desired results in India?
VIEW: Make people think twice
A study published in the Journal of Health Policy and Planning suggested a 20-30% health tax in addition to GST can be imposed on sugary drinks and foods high in sugar, salt and fat. One of the authors of the study cautioned that this isn’t taxing households against their regular purchase of sugar but on confectionary and sweet manufacturers.
India is the largest consumer of sugar in the world. The global average consumption is 22kg per person per year. In India, it’s 25kg per year. From 2016 to 2019, there was a rise in the sales of aerated drinks by 22.5%. Some calculations estimate that a 10-30% health tax on sweetened beverages could result in a 7-10% decline in demand. About 70 countries have imposed a health tax on sugar and foods rich in sugar, salt and fat. In Mexico, a tax on sweetened beverages led to decreased consumption in the first year it was implemented.
India already has some experience with a health tax. In the 2016 state budget, Kerala introduced a 14.5% indirect tax on junk food sold by brand-name restaurants. Such a tax serves two purposes – tackle the high prevalence of non-communicable diseases like diabetes and use the additional revenue for public health initiatives. There’s a win-win situation. Obviously, such a tax won’t prevent everyone from eating junk food, but it’s a good start.
COUNTERVIEW: Not exactly effective
The on-the-ground examples don’t inspire much confidence in a health tax working. Denmark introduced a tax on certain products in 2011 to fight rising obesity. The move lasted only 15 months and was scrapped. The government said people just bought what they wanted from across the border. The problem with such a tax is that it’s somewhat narrow-minded. Burgers and pizzas aren’t a part of an Indian’s everyday diet. In fact, several states have their own share of unhealthy local fried foods that people tend to consume more of. What about them?
In practice, it can be tough to target a tax on purchases where the costs someone faces when deciding what and how much to buy are not in line with the actual costs. This will obviously be different for everyone. For example, the social costs of an overweight person eating an additional chocolate bar are higher compared to a marathon runner eating the same thing. The tricky part is trying to balance reducing the consumption of people who consume more and raising the prices for people whose behaviour doesn’t create any excess costs.
Would such a tax actually work? One common comparison is smoking. Has heavy taxes on tobacco and cigarettes reduced the number of smokers? If we’re going to tax unhealthy food, people might just go somewhere where they get the same kind of food for a cheaper price, and it’ll probably be more unhealthy. Putting the onus on restaurants and companies to provide caloric information doesn’t do much other than just provide information. Since the goal is to make people eat healthy, why not make healthier options cheaper?
Reference Links:
- New Lancet study shows India sitting on obesity curve: What’s causing it? – The Indian Express
- ‘Obesity Is a Ticking Timebomb in India’: Experts on New Lancet Study – The Quint
- World Obesity Day: Why India is prone to this health crisis – India Today
- In charts: Fat tax or not, India’s obesity problem is not restricted to Kerala – Scroll
- Should We Tax Junk Foods To Curb Obesity? – Forbes
- Is ‘fat tax’ a new way to fight obesity in India? – The Hindustan Times
- India’s ‘Fat Tax’ Debate – The Diplomat
What is your opinion on this?
a) A tax on junk food will help combat obesity.
b) A tax on junk food won’t help combat obesity.
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