Government’s decision to double the tax on sweetened beverages is getting thumbs up from local, regional and international healthy lifestyle advocates and activists who say it is an example other countries should follow.
In her presentation of the 2022 Financial Statement and Budgetary Proposals in the House of Assembly on Monday evening, Prime Minister Mia Mottley announced that effective April 1, the Excise Tax on sweetened drinks will be increased from 10 to 20 per cent. She said she was also hoping to work with stakeholders to further identify items with high salt content to impose a similar tariff by October.
The Barbados Childhood Obesity Prevention Coalition, an affiliate of the Heart and Stroke Foundation, said on Tuesday that the move was long overdue.
“It is very encouraging. This is something which the Heart and Stroke Foundation and our Barbados Childhood Obesity Prevention Coalition have been seeking for a long time, to influence the Government to do this,” Lead Policy Champion of the Coalition and Medical Director of Youth Health at the Foundation, Professor Anne St John told Barbados TODAY.
She said scientific evidence has shown that an increase in taxes on sugar-sweetened drinks has had positive outcomes.
For example, the well-respected paediatric consultant cited the United Kingdom’s soft drinks industry levy (SDIL), a two-tiered tax slapped on soft drinks manufacturers from April 2018 to encourage them to reduce sugar content in their products.
A study revealed that consumption dropped by some 10 per cent one year after the tax was implemented compared to two years before.
“We also had a local researcher here who presented at the CARICOM [Caribbean Community] conference a few years ago – this is from the George Alleyne [Chronic Disease Research] Centre – to show that there was a decreased consumption of the sugar-sweetened beverages as well. There is a direct correlation between the consumption of a high sugar diet and NCDs [non-communicable diseases] developing in the population long-term. So, we are quite encouraged,” Professor St John stated.
She, therefore, expects a fall in the consumption of sugar beverages resulting from the new tax, although she believes a harsher tax would have been more effective.
“A higher increase is likely to be a lot more effective by evidence that has come out in other countries, but not wishing to be unfair to people at these times of economic difficulties, extremely difficult times, we are contented that it has increased,” she reasoned.
President of the Healthy Caribbean Coalition (HCC) Sir Trevor Hassell, welcoming the tax increase, said the Barbadian leader’s move should be an example for other regional leaders.
“I hope that policymakers in the Caribbean will follow the lead of Prime Minister Mia Mottley,” he said.
“We are also pleased that the Prime Minister referenced the ultra-processed foods and the need to reduce their intake due to their high salt, sugar, and fat content which contributes to the NCD epidemic. It is for this reason that the HCC and partners further support the Prime Minister’s stated aim to, in due course, address the issue of high salt intake,” added Sir Trevor.
He told Barbados TODAY the increase in the tax signalled to manufacturers and consumers that “high sugar intake is detrimental to our health” and it should be positively received by all those interested in the health of the people of Barbados.
The tax seeks to discourage the consumption of sugary sweetened beverages thereby reducing the likelihood of obesity and the subsequent development of NCDs in Barbados, he said.
Pointing out that a 20 per cent tax on sugar-sweetened beverages has been strongly recommended by the World Health Organisation (WHO) as a public health measure, Sir Trevor said this has been supported for many years by the Barbados National NCD Commission, the Healthy Caribbean Coalition, the George Alleyne Chronic Disease Research Centre, the Heart and Stroke Foundation and several other local health and non-health NGOs.
“It is anticipated that these organisations, following the imposition of the tax, will increase their programmes and campaigns to inform and educate Barbadians about the public health benefits of the tax and of the reduction in sugar consumption, thus contributing to the desired outcome of the tax which is the reduction of sugar intake,” he said.
The top brass of the WHO has also praised Prime Minister Mottley for raising the tax on the sweetened drinks.
In a tweet, Director General of the WHO, Tedros Adhanom Ghebreyesus said it was “wonderful news and leadership by Prime Minister Mia Mottley, putting the health of the people of Barbados first”.
“I hope more countries will follow her lead in their decision-making to keep populations healthy,” the WHO head said.
Meanwhile, tax expert Gloria Eduardo and Regional Economic Advisor Marla Dukharan said the tax hike should help in the fight against NCDs.
Addressing a post-Budget breakfast forum hosted by the Barbados Chamber of Commerce and Industry and PricewaterhouseCoopers (PwC) on Tuesday, Dukharan said higher taxes on sweetened beverages and foods with high sodium content “is a strong and welcomed positive signal sent by the Prime Minister and we need more like this”.
Eduardo, who is Tax Leader for PwC Eastern Caribbean, said she believed the higher tax on the sugar-sweetened beverages coupled with the decision to zero-rate for Value Added Tax (VAT) purposes 35 items used primarily to assist with the control of chronic diabetes, such as Glucerna, Ensure, Enterex, Pediasure, Slim Fast and Splenda products, will assist in curbing the behaviours that contribute to the high incidence of NCDs in Barbados.
“We believe that such measures which assist with improving the overall health standards in Barbados should be encouraged. They are almost like a sin tax if you ask me. The increase in the excise tax on sweetened beverages should also curb the appetite of Barbadians as these products will become more expensive and be less attainable by the average Barbadian, especially school children,” she said.
Prime Minister Mottley gave no indication of how much revenue Government was expected to rake in from the tax on sweetened beverages, which was first introduced in 2015 and was designed to generate in excess of $10 million in the first year.
A joint University of the West Indies-Cambridge University study released in 2019 concluded that Barbadians were buying fewer sweet drinks and getting more bottled waters and non-sugar alternatives.
However, the research also showed that sugary drink consumption here was still “three to four times” the global average.
emmanueljoseph@barbadostoday.bb
marlonmadden@barbadostoday.bb
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