NZ ponders 20 per cent sugary drink tax

Posted by Lani Thorpe on 10th October 2018

THE conversation in New Zealand about a sugary drink tax, of perhaps 20 per cent, has reached the prime minister’s office.

Findings of a report requested by New Zealand Prime Minister Jacinda Ardern in February of this year have been released to the NZ Herald under the Official Information Act.

The report, prepared by Ministry of Health chief science advisor Dr John Potter, details a firm argument for the introduction of the controversial tax, in efforts to reduce the nation’s growing obesity issue.

Australia and New Zealand have yet to follow the lead of 20 countries that have successfully implemented an SSB (sugar sweetened beverage) tax, which works in a similar way to the taxes applied to alcohol and tobacco whereby a price increase acts as a deterrent to consumers.

“The Finnish tax on confectionery, ice cream and SSBs showed a continuing decline in consumption of high-sugar products with the imposition of steadily increasing taxes over consecutive years,” Dr Potter wrote in the brief.

“Most crucially, the recent Berkeley, USA study showed clearly that a tax of one per cent per 30gm decreased consumption of SSBs in low-income communities and increased consumption of water.”

Also in Australian Food News

Dr Potter advised in the report that a tax of 20 per cent has been shown to be effective, with the tax applied to products based on volume or sugar content, not value.

Over time a tax could save 50 lives a year and at least NZ$6 million in health costs, raising about NZ$40m in revenue, Dr Potter’s brief stated.

The prime minister’s office responded to the Herald saying while the report was requested following media interest in the matter, it was not actively considering a tax at this time.

Meanwhile, lobby groups like the Australian Beverages Council (ABC) have been campaigning hard to prevent the tax gaining traction here in Australia, arguing education not taxation is a better approach to reducing obesity and that implementing the tax could lead to additional administration costs and a reduction in jobs.

The Australian Medical Association has criticised the ABC’s pledge to reduce sugar use by 20 per cent by 2025 as “totally inadequate” adding in a statement, “By the time 2025 rolls around, more Australians will be affected by the health harms of obesity, including from the high sugar content in SSBs.