Sugar Tax of 10% would probably decrease the quantity of sugar-sweetened beverages by approximately 12%
Well done Jamie for his work on this (hint to our celebrity Chef in NZ). I welcome the sugar tax in the UK for a number of reasons. Being Type 2 diabetic I can see the effects of sugar and other life style factors from the the other side. Go to the supermarket and do the no sugar challenge for products. Most have sugar in them.
It is a nightmare.
The key argument being put forward by the NZ government about why New Zealand should not have a sugar tax is that the price increase would not work. This advice is contrary to their own advice in an official government paper found here using the example of Tobacco and the effect of sales taxes on consumption.
The paper states clearly that:
“The health led tax increases will result in an estimated smoking prevalence among adults falling from 16.5 per cent in 2012 to around 8.9 − 6.2 per cent in 2025, based on different price elasticity’.”
So, one could reasonably consider the same kind of effect with any product and in particular harmful products in over consumption contexts such as sugar.
The contrary argument to this: is that the price elasticity of sugar vs. tobacco is different. I found some interesting research on that too. Colchero et al., 2015 showed that:
“Price elasticity for soft drinks was -1.06 and -1.16 for SSB (sugar-sweetened beverages), i.e., a 10% price increase was associated with a decrease in quantity consumed of soft drinks by 10.6% and 11.6% for SSB. A price increase in soft drinks is associated with larger quantity consumed of water, milk, snacks and sugar and a decrease in the consumption of other SSB, candies and traditional snacks.”
Colchero MA1, Salgado JC2, Unar-Munguía M2, Hernández-Ávila M2, Rivera-Dommarco JA2., Price elasticity of the demand for sugar sweetened beverages and soft drinks in Mexico, Econ Hum Biol. 2015 Dec;19:129-37. doi: 10.1016/j.ehb.2015.08.007. Epub 2015 Sep 5.
Price is a very strong perceptual variable!
Think about the other effects of a sugar tax. It would place the spotlight on sugar. It would put it in a similar category to tobacco. Price is a strong perceptual variable. Lets use it.
Finally, Stevia. This is one of the natural substitutes. It grows like a herb and from my experience in my garden: it is vigorous. Grows like a weed. The only downside that I can gather from this natural products is that it is very sweet and can heighten a consumers desire for the sweet taste. However, maybe this is an opportunity for NZ horticulture. Lets breed the ultimate sugar substitute in NZ.
Conclusion: Subjectively, The Sugar Tax Would Work.