Taxes do change behaviour – but only at certain levels

John Bishop writes in NBR:

The advocates of a also argue that price rises worked for tobacco, so why would they not also work for sugar.

I think there are three differences.

The first is that over time smoking became more and more socially unacceptable; smokers became social pariahs. That hardly applies to sugar consumers, whatever health damage their habit might be causing.

Second, the places where one could smoke were progressively reduced. No one is suggesting that consumption of sugar should be confined to certain designated areas.

Should there be a ban in cafés on sugar sachets on the table, or on selling cakes with a sugar content over a certain level? Good luck with that idea.

Third, the price increases in tobacco were large and regular. But even then it took years for people to cut out tobacco (and there was taxpayer funded assistance to do so through Quitline and the like). None of that will likely apply to a sugar tax. (Or a fat tax for that matter.)

The tax on tobacco is now around 400%. A pack which would normally cost $4 costs $20 due to the tax.

A 10% or even 20% tax on sugar would raise a lot of revenue but have minimal impact on sugar levels, let alone obesity.

Comments (29)

Login to comment or vote