MEXICO SOFT DRINKS TAX FAILURE

Well, it hasn’t failed if its true purpose was to boost Government tax revenue. In just 4 years, the Mexican soft drinks levy has generated $5,500 million of extra tax payments.

But, it was supposed to reduce obesity and there is no sign of that.

An exclusive interview on foodbev.com with ANPRAC, the Mexican soft drinks association, shows:

• Mexicans consume an average 3,072 calories per day; and
• the contribution from soft drinks has fallen by just 6.6 calories per day, a negligible 0.2%.

This is despite:

• soft drinks price increases at twice the rate of inflation; and
• a 7% reduction in the average calorie content of all soft drinks in the last 6 years.

The social consequences, however, have been serious:

• 30,000 small stores have closed, according to ANPEC, the small traders alliance; and
• 62% of the amount collected has come from the lowest income households – “the pattern of consumption of the lowest strata has not changed significantly … their economic wellbeing has been affected.”

It remains clear to me that obesity does need tackling and this requires a comprehensive strategy across all food and drink involving information, education, communication, activity and incentive.

My greatest concern is that ineffective action, as in Mexico, merely delays effective action, by creating the illusion of a strategy which is really no strategy at all.

I fear the same for this month’s new taxes in South Africa and the United Kingdom as well as next month’s in Ireland.