Mexico’s decision to tax sugar-sweetened drinks as part of a wider anti-obesity program is working, according to a new study published in the British Medical Journal. The country implemented a 10% tax on sugary drinks that went into effect in January 2014, even though public health experts had called for a 20% levy. Mexico’s obesity epidemic is among the worst in the world. About 70% of adults in the country are overweight or obese.
A nationwide tax could trigger behavioral changes
The study found that sales of sugary beverages declined 6% across the country in 2014. The decline accelerated over time, reaching 12% in December 2014. It is the first hard evidence that a countrywide tax could trigger behavioral changes that could help reduce obesity rates. The sales declined across all socio-economic groups, but it was highest among poorer households, whose consumption fell 17%.
This year has been a record-breaking year for initial public offerings with companies going public via SPAC mergers, direct listings and standard IPOS. At Techlive this week, Jack Cassel of Nasdaq and A.J. Murphy of Standard Industries joined Willem Marx of The Wall Street Journal and Barron's Group to talk about companies and trends in Read More
Arantxa Colchero of the National Public Health Institute and lead author of the study said Mexico was a good example that the soda tax was working. Other countries that were observing it as a test case are likely to implement their own taxes on sugary beverages. Notably, Mexico has the highest per capita consumption of soft drinks. Sugary beverages account for 70% of the total added sugar taken by an average Mexican.
Mexico took a variety of measures to reduce obesity
The exhaustive study was conducted by the National Public Health Institute and the University of North Carolina at Chapel Hill. Researchers looked at purchasing patterns before and after the tax was implemented. For the study, they used national data on food purchases gathered by Nielsen Mexico’s Consumer Panel Services from more than 6,200 households across 53 cities.
Besides the drop in sales of sugar sweetened beverages, researchers found that bottled water sales rose 4% in 2014. Dr. Juan Rivera, the co-author of the study, said findings were encouraging. Rivera urged the government to hike the tax rate from 10% to 20%. Other measures taken by the Mexican government to reduce obesity include a ban on certain junk food ads, healthier school meals, and food labels with clear nutrition information.