Combined fiscal policies to promote healthier diets: Effects on purchases and consumer welfare

Fat vs. Sugar: The Case for a Saturated Fat Tax in Italy

When judging the distributional impact of unhealthy food taxes, what matters is not just how much low income people would pay but how much the such taxes would benefit or harm them overall. In this paper, we assess the consumer welfare impact of a fat tax net of its expected benefits computed as savings from weight loss. Using Italian data, we estimate a censored Exact Affine Stone Index (EASI) incomplete demand system for food groups, simulating changes in purchases, calorie intake, consumer welfare, and the monetary value of short-run health benefits. While the Italian government has proposed a sugar tax, we show that there is no significant excess consumption of added sugars among Italian adults. Instead, excessive fat consumption is more prevalent, making a fat tax a more compelling and effective solution to address diet-related health risks. Our results suggest costs from fat taxation are larger than benefits at all income levels. As a fraction of income, the net impact would be slightly regressively distributed.

Cost-effectiveness of tax policies on promoting sustainable diets in Iran: a modeling study

Background

Implementation of food taxes may promote sustainable diets in a society. This study estimates the potential short-term impacts of taxes on sugar and sweets (SAS), sugar sweetened beverages (SSB) and hydrogenated oil and animal fats (HOAF) in Iran through a social cost-effectiveness analysis.

Methods

In this study, three tax scenarios were evaluated, including a 25% tax on SASs, a 30% tax on SSBs, and a 30% tax on HOAFs. The data from Iran's 2019-2020 Household Income and Expenditure Survey (HIES) were utilized, and a simulated population of 1 million individuals aged over 25 years was analyzed. Population impact fraction (PIF) was calculated to estimate the averted number of cases and Disability-Adjusted Life Years (DALYs) under each policy scenario. Additionally, the study assessed water and carbon footprints, as well as all associated costs. Cost-effectiveness was evaluated through incremental cost-effectiveness ratios (ICER) and comparison with WHO-recommended thresholds.

Results

Implementation of taxes on SASs and HOAFs resulted in reductions of 1.09 and 1.08% in water footprint, as well as 0.47 and 1.05% in carbon footprint, respectively. In terms of population health, the interventions resulted in averting 343.92 DALYs (95% UI = 318.62-369.36) for the SSB tax and 1219.01 DALYs (95% UI = 1123.05-1315.77) for the tax on HOAFs. Additionally, the tax on SASs averted 1028.09 DALYs (95% UI = 947.16-1,109). All scenarios were deemed cost-effective based on the WHO threshold for ICER, with values of 0.26 billion Rials/DALY, 0.54 billion Rials/DALY, and 0.17 billion Rials/DALY, respectively.

Conclusion

The studied tax scenarios could generate substantial health gains and be cost-effective in Iran. It is recommended that policymakers consider implementing such price policies to promote healthy and sustainable diets.

Effectiveness of implemented global dietary interventions: a scoping review of fiscal policies

BACKGROUND

Although the World Health Organisation (WHO) has proposed the use of fiscal policies to mitigate consumption externalities such as overweight and obesity-related diseases, very little is known about the impacts of the different types and framing of national and/or regional fiscal policies that have been implemented over the years. There is the need to provide up-to-date evidence on the impact of fiscal policies that have been enacted and implemented across the globe.

METHODS

We conducted a scoping review of all implemented government fiscal policies in the food and drinks sector to identify the different types of fiscal policies that exist and the scope of their impact on consumers as well as the food environment. Electronic databases such as the Web of Science and Google Scholar were used to search for appropriate literature on the topic. A total of 4,191 articles were retrieved and 127 were synthesized and charted for emerging themes.

RESULTS

The results from this review were synthesized in MS Excel following Arksey & O'Malley (2005). Emerging themes were identified across different countries/settings for synthesis. The results confirms that fiscal policies improve consumers' health; increase the prices of foods that are high in fats, sugar, and salt; increase government revenue; and shift consumption and purchases towards healthier and untaxed foods.

CONCLUSION

Governments already have the optimum tool required to effect changes in consumer behaviour and the food environment.

Intake of ultra-processed food, dietary diversity and the risk of nutritional inadequacy among adults in India

OBJECTIVE

This study assessed diet diversity and consumption of ultra-processed foods and explored its impact on macronutrient intake and risk of micronutrient inadequacy.

DESIGN

Cross-sectional, non-probability snowball sampling.

SETTING

Nutrient intake was assessed using 24-h dietary recall method and diet diversity through FAO-diet diversity score (DDS). Mann-Whitney U test was used to assess differences in risk of inadequacy across gender. Spearman's rank correlation assessed associations between energy contributed by ultra-processed food and risk of nutrient inadequacy.

PARTICIPANTS

A total of 589 adults (20-40 years) belonging to upper-middle and high-income groups.

RESULTS

The average individual DDS was 4·4 ± 0·6. Most of the participants (>80 %) had intakes less than national recommendations of pulses/eggs/flesh foods, milk/milk products, fruits, vegetables and nuts. Ultra-processed foods contributed to 17 % of total energy intake, 12 % of protein, 17 % of carbohydrate, 29 % of added sugar, 20 % of total fat and 33 % of Na intake. The average risk of nutrient inadequacies for Zn (98 % v. 75 %), folate (67 % v. 22 %) and niacin (83 % v. 44 %) was higher among males than females (P < 0·001). The average risk of nutrient inadequacies for Fe (58 % v. 7 %), vitamin B6 (95 % v. 90 %) and vitamin A (68 % v. 44 %) was higher among females than males (P < 0·001). There was a positive correlation between energy contributed by ultra-processed food and risk of niacin (ρ = 0·136, P = 0·001) and folate (ρ = 0·089, P = 0·049) inadequacy.

CONCLUSION

Reformulating ultra-processed food to reduce fat, sugar and salt and increase micronutrients and behaviour change communication strategies that promote dietary diversity will improve micronutrient adequacy and diet quality.

Healthier Food Purchase and Its Determinants in an Urban Resettlement Colony of Delhi

Dietary risk, one of the major risk factors for the increasing burden of non-communicable diseases, is influenced by household food choices and purchases. A community-based cross-sectional study was conducted in 250 randomly selected households of an urban resettlement colony in Delhi to estimate the proportion of households purchasing different healthier food options during the last purchasing occasion and to identify its key determinants. Purchase of healthier options in staple items like wheat flour with fiber (100%), plant-based oils (97.9%), unpolished pulses (96.2%), and toned milk (94.5%) was high. Affordability and health considerations in food purchases were identified as key determinants.

Structural responses to the obesity epidemic in Latin America: what are the next steps for food and physical activity policies?

Obesity is among the most complex public health challenges, particularly in Latin America, where obesity rates have increased faster than in any other region. Many countries have proposed or enacted comprehensive policies to promote adequate diet and physical activity under a structural framework. We summarize articles discussing the scope and impact of recently implemented obesity-related interventions in the light of a structural response framework. Overall, we find that: (1) market-based food interventions, including taxes on junk food, nutrition labelling, and marketing restrictions, decrease the consumption of targeted foods, (2) programs directly providing healthy foods are effective in reducing obesity, and (3) the construction of public areas for recreation increases the average frequency of physical activity. Although obesity-related interventions in the region have somewhat improved health behaviours, obesity prevalence remains on an upward trend. We discuss some opportunities to continue tackling the obesity epidemic in LATAM under a structural framework.

Simulation models of sugary drink policies: A scoping review

INTRODUCTION

Simulation modeling methods are an increasingly common tool for projecting the potential health effects of policies to decrease sugar-sweetened beverage (SSB) intake. However, it remains unknown which SSB policies are understudied and how simulation modeling methods could be improved. To inform next steps, we conducted a scoping review to characterize the (1) policies considered and (2) major characteristics of SSB simulation models.

METHODS

We systematically searched 7 electronic databases in 2020, updated in 2021. Two investigators independently screened articles to identify peer-reviewed research using simulation modeling to project the impact of SSB policies on health outcomes. One investigator extracted information about policies considered and key characteristics of models from the full text of included articles. Data were analyzed in 2021-22.

RESULTS

Sixty-one articles were included. Of these, 50 simulated at least one tax policy, most often an ad valorem tax (e.g., 20% tax, n = 25) or volumetric tax (e.g., 1 cent-per-fluid-ounce tax, n = 23). Non-tax policies examined included bans on SSB purchases (n = 5), mandatory reformulation (n = 3), warning labels (n = 2), and portion size policies (n = 2). Policies were typically modeled in populations accounting for age and gender or sex attributes. Most studies focused on weight-related outcomes (n = 54), used cohort, lifetable, or microsimulation modeling methods (n = 34), conducted sensitivity or uncertainty analyses (n = 56), and included supplementary materials (n = 54). Few studies included stakeholders at any point in their process (n = 9) or provided replication code/data (n = 8).

DISCUSSION

Most simulation modeling of SSB policies has focused on tax policies and has been limited in its exploration of heterogenous impacts across population groups. Future research would benefit from refined policy and implementation scenario specifications, thorough assessments of the equity impacts of policies using established methods, and standardized reporting to improve transparency and consistency.

Applying and comparing various nutrient profiling models against the packaged food supply in South Africa

OBJECTIVE

This study aimed to apply the newly developed Chile Adjusted Model (CAM) nutrient profiling model (NPM) to the food supply in South Africa (SA) and compare its performance against existing NPM as an indication of suitability for use to underpin food policies targeted at discouraging consumption of products high in nutrients associated with poor health.

DESIGN

Cross-sectional analysis of the SA-packaged food supply comparing the CAM to three other NPM: SA Health and Nutrition Claims (SA HNC), Chilean Warning Octagon (CWO) 2019, and Pan-American Health Organisation (PAHO) NPM.

SETTING

The SA-packaged food supply based on products stocked by supermarkets in Cape Town, SA.

PARTICIPANTS

Packaged foods and beverages (n 6474) available in 2018 were analysed.

RESULTS

Forty-nine per cent of products contained excessive amounts of nutrients of concern (considered non-compliant) according to the criteria of all four models. Only 10·9 % of products were not excessive in any nutrients of concern (considered compliant) according to all NPM evaluated. The CAM had an overall non-compliance level of 73·2 % and was comparable to the CWO 2019 for foods (71·2 % and 71·1 %, respectively). The CAM was the strictest NPM for beverages (80·4 %) due to the criteria of non-sugar sweeteners and free sugars. The SA HNC was the most lenient with non-compliance at 52·9 %. This was largely due to the inclusion of nutrients to encourage, which is a criterion for this NPM.

CONCLUSION

For the purpose of discouraging products high in nutrients associated with poor health in SA, the CAM is a suitable NPM.

The Effects of Food Taxes and Subsidies on Promoting Healthier Diets in Iranian Households

Background and Aim

Price, as a key driver of food purchasing, has an important role in determining the consumer demand. This study is aimed to estimate the effect of food taxes and subsidies on purchasing patterns of Iranian households (HHs).

Methods

This study was performed in two phases. In phase one, a two-round Delphi study was conducted to determine and prioritize food-related fiscal policies; and in the second phase, using the Iranian Household Income and Expenditure Survey (HIES), we estimated an almost ideal demand system (AIDS) and simulated changes in purchases, nutrient intake, and consumer welfare under six different policy scenarios: (1) 20% subsidy on vegetables, (2) 20% subsidy on fruits, (3) 30% subsidy on legumes, (4) 25% tax on sugar and sweets, (5) 30% tax on sweetened beverages, and (6) 30% tax on hydrogenated oil and animal fats.

Results

The highest calorie reduction was detected in sugar and sweets tax, which has resulted in 949.67, 971.68, and 1,148.03 kilocalories decrease in energy intake per Adult Male Equivalent (AME) in all HHs, low-income HHs, and high-income HHs, respectively. In terms of welfare changes, high-income HHs will experience a lower change in welfare (−0.81 to 0.11%) relative to their income when compared with low-income HHs (−0.88 to 0.28%) due to fiscal policies.

Conclusion

Fiscal policies in Iran can be a potential way to improve dietary choices. The findings provide essential information for decision makers for the implementation of food-related fiscal policies.

The impacts on food purchases and tax revenues of a tax based on Chile's nutrient profiling model

BACKGROUND

In June 2016, Chile implemented the Law of Food Labelling and Advertising, which included a mandatory front-of-pack warning labels on food and beverages high in added sugar, saturated fat, sodium or energy density, restrictions on child-directed marketing and on the promotion and sales of these products in schools. The regulation does not include taxes although Chile had implemented a tiered tax on SSBs two years before this law was implemented. Therefore, the objective of the study was to simulate the impact of taxing food and beverages based on the cutoff's points for warning labels on purchases and revenues.

METHODS

We derived price elasticities using the linear approximation of the almost ideal demand system for six groups of labeled food and beverages (with a warning label based on the regulation) and unlabeled (with no warning label): 1) unlabeled beverages, 2) labeled beverages, 3) unlabeled cereal based products, 4) labeled cereal based products, 5) labeled meat and fish and 6) labeled sweet snacks and desserts. The study used data on household food beverage purchases from the Kantar WorldPanel Chile and Euromonitor sales to adjust the Kantar elasticity results to the national average. We estimated revenues under three tax scenarios for all labeled food and beverages: 10%, 20%, 30% of the final price excluding taxes.

RESULTS

Except for labeled fish and meat, all food and beverage groups were price elastic. After accounting for a reduction in consumption after the taxes, economic and population growth, revenues for all groups could reach between 457 million USD to 1.3 billion USD. These results based on the much larger tax base of these labeled "high in added sugar, salt or saturated fat or energy density" foods and beverages is much larger.

CONCLUSION

This fiscal package could be implemented in countries with warning labels to enhance health and welfare. The Chilean warning label front-of-the-package system provides an important guide for countries considering policies to reduce diet-related non communicable diseases, including obesity. The fiscal policy impact alone, as shown here for Chile, will be highly impactful in reducing ultra-processed food intake and generating revenues.

In search of an appropriate mix of taxes and subsidies on nutrients and food: A modelling study of the effectiveness on health-related consumption and mortality

Taxes and subsidies on foods and nutrients have the potential to promote healthier diets and thereby reduce mortality. In this study, we examine the effects of such policy instruments on Swedish public health. Specifically, we estimate the effects of food and nutrient taxes and subsidies on mortality averted and postponed in Sweden, using both demand system estimations and simulation models. We evaluate different Value Added Tax (VAT) reforms. The VAT is raised on food products that are particularly rich in saturated fat or salt and lowered on fruit and vegetables. Our models predict that an increase in the current VAT of 12% on food, to 25% VAT on products rich in saturated fat plus a 0% VAT on fruits and vegetables would result in almost 1100 deaths (95% CI: -832; -1363) averted or postponed in a year in Sweden, while the combination of a 34.4% VAT on products rich in saturated fat and a -10.4% VAT (i.e. a subsidy) on fruits and vegetables would result in almost 2100 (95% CI: -1572; -2311) deaths averted or postponed corresponding to a 4.8% reduction in diet-related annual death. Most of the deaths averted or delayed from this reform would be deaths from coronary heart disease (-1,148, 95% CI: -728; -1586), followed by stroke -641 (95% CI: -408; -887) and diet-related cancer deaths (-288, 95% CI: -11; -435). We find that health-related food taxes and subsidies improve dietary habits as well as reduce the mortality of the Swedish population. However, the effect of these reforms on different socioeconomic classes and which reforms provide the best value for money, i.e., cost-effectiveness of these reforms needs to be established first before implementation.

A Fit-for-Purpose Nutrient Profiling Model to Underpin Food and Nutrition Policies in South Africa

South Africa (SA) is facing a rising prevalence of obesity and diet-related chronic diseases. The government is seeking to develop effective, evidence-based policy measures to address this. A well-designed, fit-for-purpose nutrient profiling model (NPM) can aid policy development. The aim of this study was to develop a fit-for-purpose NPM in SA. Steps included: (1) determining the purpose and target population; (2) selecting appropriate nutrients and other food components to include; (3) selecting a suitable NPM type, criteria and base; and (4) selecting appropriate numbers and thresholds. As part of the evaluation, the nutritional composition of packaged foods containing nutritional information (n = 6747) in the SA food supply chain was analyzed, a literature review was undertaken and various NPMs were evaluated. Our findings indicated that it is most appropriate to adapt an NPM and underpin regulation with a restrictive NPM that limits unhealthy food components. The Chile 2019 NPM was identified as suitable to adapt, and total sugar, saturated fat, sodium and non-sugar sweetener were identified as appropriate to restrict. This NPM has the potential to underpin restrictive policies, such as front-of-package labelling and child-directed marketing regulations in SA. These policies will support the fight against obesity and NCDs in the country.

Would A National Sugar-Sweetened Beverage Tax In The United States Be Well Targeted?

Sugar-sweetened beverage (SSB) taxes have been proposed to discourage excessive sugar consumption, but it is unclear how high- vs. low-SSB purchasers respond to such taxes. We first examine heterogeneity in the purchase and financial effects of a national SSB tax across different types of households buying varying amounts of SSBs. We find high-SSB purchasers are less responsive to SSB price changes than low purchasers but make larger absolute reductions in SSB purchases in response to the tax, given their notably greater purchase levels prior to the tax. Nonetheless, the economic burden of the tax falls more heavily on high-SSB purchasers who are more likely comprised of lower-income households. We then investigate whether the income regressivity of the tax will be mitigated if low-income households are targeted by fruit and vegetable (FV) subsidies. We show that depending on the tax pass-through and subsidy rates, FV subsidies can fully offset high-SSB purchasers' tax burdens, and subsidy transfers are distributed relatively uniformly across the SSB purchase distribution of low-income households. Therefore, FV subsidy transfers would be financially more beneficial to low- and moderate-SSB purchasers because they bear smaller shares of the tax burden than high-SSB purchasers.

Do taxes on unhealthy foods and beverages influence food purchases?

PURPOSE OF REVIEW

Interest in taxes on unhealthy foods and beverages as a public health tool has increased in recent years. This paper aimed to summarise recent evidence of the impact of taxes on unhealthy foods and beverages on food purchases, and discuss opportunities to advance knowledge and policy impact.

RECENT FINDINGS

Evaluations of taxes on unhealthy foods and beverages have shown reductions in purchases of targeted unhealthy products and nutrients. Similarly, data from multiple sources demonstrate that as prices of unhealthy foods and beverages increase, purchase volume decreases. However, studies indicate potential for substitution to non-taxed unhealthy foods, which needs to be factored into taxation design. Taxes on unhealthy foods and beverages are a promising strategy to improve population diets. Further research is required to understand food industry responses to tax implementation, as well as the impact of taxes on population and planetary health outcomes.

Brown sugar, how come you taste so good? The impact of a soda tax on prices and consumption

Increasing obesity-related problems and rising healthcare expenditures have led governments in developed countries to consider the introduction of soda taxes. We study a recent such tax, implemented in Portugal in February 2017 -one of the first soda taxes worldwide that increases with sugar content (0.08 euros per liter for drinks with less than 80 g of sugar per liter, and 0.16 euros per liter for drinks with 80 g or more sugar per liter, plus VAT). We use extremely detailed panel data from one of the two largest retailers in the country, covering the period between February 2015 and January 2018. We take advantage of the tax breakdown by sugar levels to examine how soda prices and quantities purchased reacted. For identification, we rely on difference-in-differences models with various vectors of fixed effects, comparing each group of products to water. For drinks with more than 80 g of sugar per liter, results indicate almost full price pass-through to the consumer. For drinks with less than 80 g of sugar per liter, price pass-through surpassed 100%. Regarding consumption, our findings suggest stockpiling behavior in the quarter when the tax was approved and before it was actually implemented. In the implementation period, there are no significant changes in quantities purchased for most beverages vis-à-vis water, with the exception of soda drinks with comparatively low levels of sugar. This suggests that benefits of the soda tax in terms of reducing sugar intake are mainly due to reformulation, as producers reduced the sugar content of some drinks to fall below the 80 g per liter threshold.