Sugary drink tax reduces consumption by 20%

The sugary drink tax applied in Catalonia on May 1 last year has reduced consumption by 22%, according to a study carried out by two Catalan unviersities.

There is a direct correlation between the increase in price of sugary drinks and a drop in consumption, conclusions of the investigation found.

“Without a doubt the tax has been effective and achieved its short term objective,” explained Judit Valls, co-author of the study, the first of its kind since the tax was put into force nearly a year ago.

In terms of the impact on people’s health, the researchers discovered that consumers of sugary drinks now ingest 107 calories less per week than before the levy was introduced.

Areas of high obesity

“We also found that the consumption of sugary drinks has reduced a lot more in areas of Catalonia with high levels of obesity amongst the population with a higher risk of cardiovascular disease or diabetes,” Valls told the Catalan News Agency.

 According to the study, the price of sugary drinks in bottles of one or two litres increased by about 20%, whereas drinks in cans have been increased by between five and ten percent. For this reason, consumption of big sugary drinks fell a lot more than that of cans, Valls explained. She stressed the importance of implementing the tax 100% to the final price of the product in order for it to have a bigger impact.

Substituting sugar

On the other hand, the investigation found that there is a "substitution effect.” This means that part of the fall in the consumption of sugary drinks is replaced by the consumption of light and zero drinks whose sales have increased since the implementation of the levy.

In order to carry out the investigation, research groups from the University of Barcelona and Pompeu Fabra University used weekly sales data on 105 products in 160 stores of the Catalan supermarket chain Bon Preu.

Controversial measures

When the tax came into force on May 1 2017, it was not without its controversy. The Catalan government argued that its “main purpose was to change consumer habits, as recommended by the World Health Organization.” The manufacturers and distributors assopciation (AECOC) saw things differently, however. The entity argued that the measure was “discriminatory,” stating that “taxation” is not the best way to solve health problems.

In the eight months since the tax was put in force, it has raised 22.7 million euros for the government. Drinks with more than eight grams of sugar per 100 millilitres saw an increase of price of 0.12 euros per litre. Drinks with between five and eight grams per millilitre increased in price by 0.08 per litre.