The new sugar tax on soft drinks may see young people switch to healthier beverages, but it is unlikely to help those who have a high-sugar diet, a new study finds.
Three economists at the Institute for Fiscal Studies – Pierre Dubois, Rachel Griffith and Martin O’Connell – have raised questions about the efficacy of the government’s soft drinks industry levy.
Drinks makers who do not cut sugar levels will have to pay 18p a litre on drinks that have more than 5g of sugar per 100ml and 24p a litre on those that have 8g or more of sugar per 100ml. Already about half of makers have reduced sugar content.
According to the economists’ modelling, recently presented at the Royal Economic Society’s annual conference at the University of Sussex and which simulates the effects of a 25p per litre tax, the tax will lead young people to reduce the amount of sugar they buy via soft drinks by about 80% more than the average consumer.
“Our results show that young consumers would lower their sugar consumption by more than older individuals in response to a soda tax. The tax, therefore, succeeds in achieving relatively large reductions in sugar among one group,” the study notes.
However, the research also suggests that “those with high-sugar diets are relatively price inelastic and therefore fail to lower their sugar consumption in response to the tax by more than more moderate sugar consumers.”
The findings have implications for Britain and beyond. A growing number of cities and countries have adopted taxes on sugary drinks to help combat sugar consumption, which is blamed for rising obesity levels. The World Health Organisation recommends that no more than 5% of calories should come from added sugar. However, using data drawn from the National Diet and Nutrition Survey, the economists estimate that 94% of individuals in Britain exceed the WHO recommendation.
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