Is a snack tax on the horizon?

Tuesday 8th Jun 2021, 1.12pm

Do you remember when the price of fizzy drinks in the UK went up slightly a few years ago? Soda fans, perhaps you remember all too clearly…! Well, this was because the UK government introduced a sugar tax (or the Soft Drinks Industrial Levy, to be precise), requiring manufacturers to pay a tax on sugary drinks – a cost which was then passed on to the customer. Following the success of this tax (perhaps not for your pocket, but fizzy drinks now contain less sugar) we’re asking public health nutritionist Dr Lauren Bandy – is a snack tax on the horizon?

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Emily Elias: You might not remember it, but, a couple of years ago, fizzy drinks in the UK became a tiny bit more expensive. The UK Government introduced a soda tax to try and curb our sugary drink intake. It appears public health is pretty pleased with the results, so that got us thinking about our beloved high-sugar, high-salt snack foods. On this episode of the Oxford Sparks Big Questions podcast, we are asking: is a snack tax on the horizon?

Hello, I’m Emily Elias, and this is the show where we seek out the brightest minds at the University of Oxford and we ask them the big questions. For this one, we have found a researcher who is laser-focused on what we shove in our mouths.

Lauren Bandy: My name is Lauren Bandy. I’m a postdoctoral researcher at the Nuffield Department of Population Health at University of Oxford, and I look at the nutritional quality of foods in the UK. I see how the sugar content and the salt content of foods are changing over time.

Emily: You’ve been following the soda tax. Can you just remind us how that was all set up?

Lauren: Yes, so it came a little bit out of the blue, to be honest. It was announced by the Chancellor in 2016, in the budget. Basically, they announced that a soda tax would be coming in. Then, a year later, they announced that they would be introducing a levy at the manufacturer level. So, this would be paid for by the soft-drink companies themselves, with the expectation that it would be passed on to the consumer, but they introduced a levy of 18p per litre for drinks that contain between 5g and 8g of sugar per 100ml, and then anything that contain more than 8g subject to 24p per litre. So, anything that contained less than 5g of sugar would not be subject to the levy.

Really, what that did when it came in, in 2018, was really encouraged manufacturers to remove some of the sugar from their products, to contain less than 5g of sugar and avoid the tax. Any of the products that still did contain sugar, the prices went up, with the hope that they become more expensive and that consumption might come down a bit.

Emily: Did it work?

Lauren: We really have seen an effect. We saw that the sugar content of soft drinks fell by about a third in the UK. It does seem to have worked. Not just to, I suppose, reduce the consumption, that actually volume sales of soft drinks overall have increased. Things like bottled water and juice drinks have steadily increased, while fizzy drinks have come down, but we’ve really seen manufacturers reformulating. They’ve really reduced the amount of sugar in their products, to avoid the tax.

Emily: You guys had time to crunch the numbers. Is this a big public health thumbs-up, or is this like a big public health emoji thumbs-down?

Lauren: I think, so far, it’s a thumbs-up. At the moment, we can see that soft drinks, the sugar content of such drinks has come down. So, by reformulating drinks that people can carry on drinking, I guess, it has, kind of, been a success.

We’re yet to see what impact this has had on public health, because it’s quite hard to measure how has this changed calorie consumption? How has this changed weight, and how has this changed obesity and other health outcomes? So, we’re doing some modelling work that is yet to show what impact that it has had on health outcomes.

Obviously, there are lots of other things that could impact on those health outcomes along the way, and on obesity along the way, so I think yes, for now, it looks like it has worked. Let’s see if we can back that up with some modelling to see what impact that has actually had on health outcomes.

Emily: But this is soda, which is something, I guess, that’s fairly easy to play with the formula.

Lauren: Yes.

Emily: When it comes to looking at snacks, then, has the government, kind of, been stroking its chin and raising an eyebrow of, like, “Hmm, what can we do here?”

Lauren: Yes, so I think snacks are slightly different. Soft drinks are easy. They are water and they’re sugar, so it’s quite easy to take the sugar out, because you just replace it with water. You might want to replace it with a bit of artificial sweetener, but generally it’s quite a straightforward thing to do in terms of food technology.

When it comes to cake, you can’t really bake a cake without sugar, and you can’t really make a biscuit without sugar. So, if you want to reduce the sugar content of products, say by setting reformulation targets, which the government have done, it’s a little bit harder for those manufacturers to do. Not impossible.

Of course, they will argue that, “Oh, no, we can’t possibly take sugar out, because sugar has other technical properties,” where in reality they probably could. So, I think the government are looking at other things.

Emily: Like what?

Lauren: Like with the current reformulation targets at the moment. These cover foods that are high in sugar and high in salt, so specifically looking at snacks, things like biscuits, confectionery, sugar and chocolate confectionery, cakes, yoghurts, ice creams. There are 20% reformulation targets that the government have set.

Emily: So, they’ve said to industry, “Can you do this?” but they’ve made it voluntary. Has industry really complied with these voluntary reformulations of the snacks that we know and love today?

Lauren: No. I suppose that the answer to that is, “No.” The government have set 20% sugar-reduction targets for groups of foods, including breakfast cereals, yoghurts, chocolate confectionery, sugar confectionery, cereal bars, things like that, your classic sweet snacks.

We haven’t really seen a reduction. We’ve only seen a 5% reduction in the sugar content of foods overall, and that was primarily driven by yoghurts and by breakfast cereals. These products have had quite a lot of flak from the media over the recent years because they’re products that are consumed, often by children, every day. There was a lot of anger, I think, that actually these products contain a lot of sugar that you wouldn’t expect, so-called hidden sugars.

We’ve seen a lot of change just driven from these two categories and actually a lot of other products, even though we have these voluntary reformulation targets, and they haven’t been hit. So, I think the government is probably thinking, “Okay, what could we do next?” Perhaps it’s more, kind of, a carrot-and-stick situation: “Okay, the carrot hasn’t worked, so what is the stick?”

Emily: The soda tax went so well, so what could a snack tax even look like? Like, what’s the big idea here?

Lauren: I don’t know if there is a big idea yet, to be honest. The take-home: I think some of the learnings that we can take from the soda tax were that soft drinks were quite an easy thing to define, so there were quite clear categorisation of, “Okay, these are the products that we include and we don’t include.” So, I think the first thing you need to do is, like, “Okay, well, what products do you tax? Do you tax confectionery? Do you tax biscuits? Do you tax cakes?” You need to look and define what it is that you want to tax first.

So, I don’t know if it’s going to be quite so easy. I think, for confectionery, it’s an easy win, in the same way with soft drinks, whereas there is no nutritional benefit to a soft drink. It is just water and sugar. It’s just so-called ‘empty’ calories. You’re not getting any other nutrients from a soft drink, whereas you could argue, with cakes and biscuits, yes, there’s a bit of protein in there. You are getting other things.

Perhaps a bit of a weak argument, but I think it’s probably an argument that industry might play, whereas with confectionery it’s, kind of, the same thing with soft drinks. It’s like, “This is just a high-sugar product. It’s bringing no benefit to the diet overall, certainly not at a population level.” So, that would be an easy thing to target. I think the first thing to do is to define what you want to tax.

Emily: How are other countries tackling a snack tax, then, because this is not a unique problem to the UK?

Lauren: No. In Mexico, in 2014, they introduced in an 8% tax on products that contain more than 275 calories per 100g. These are basically classed as energy-dense foods, sweet and savoury snacks. We saw a reduction in their consumption of around 6% in the first few years and so generally that’s seen as a bit of a success.

It’s then hard to, I suppose, estimate what impact that has had on obesity rates, but a reduction of 6% is quite good. The UK could set something like that, similar to Mexico, where you say, “Okay, all products that contain more than 275 calories per 100g,” for example, “Would be subject to a tax,” of, I don’t know, 8%, 10%, 20%. That would be one option.

Emily: Do you think that would actually work in changing people’s behaviours?

Lauren: Yes, potentially. I suppose the logic is you increase the price of something, people buy less of it, and they consume less of it. That’s a good thing in the case of snacks, really. There has been a bit of modelling work that has looked at a 20% tax on sweet snacks, which include sugar and chocolate confectionery, biscuits, and cakes.

Overall, they modelled that that would reduce obesity prevalence in the UK by around 3%, just less than 3%. A 20% tax doesn’t necessarily mean a 20% reduction in obesity. Obviously, there are lots of things that happen between the tax and the health outcomes.

I don’t know. There are lots of things, other things that could factor in. So, okay, if you tax confectionery and that becomes more expensive but you don’t tax biscuits, will people switch from confectionery to biscuits, for example? Will that then have a detrimental or counteract the effect of the tax? There are lots of other things.

Of course, just because you’re taxing energy-dense foods, that’s not incentivising you to actually eat healthy foods. I think that’s the other key with taxing. Yes, you can tax all the unhealthy foods, but is that going to encourage people to eat more healthy foods, which is ultimately what you want to do?

Emily: Really, they should just make all healthy food free and we could just live in a utopian society. (Laughter)

Lauren: That is an alternative. Instead of taxing unhealthy foods, do we subsidise healthy foods, so do we offer more fruit and vegetable vouchers, things like that? They’re alternatives. Then, as well as just looking at the prices of foods, do you look at the portion sizes, for example? So, instead of making foods more expensive, do you make foods smaller? There are other things that you can do to try and reduce the consumption of healthy foods.

Emily: I guess the big question is – dun, dun, dun – do you think that we could see a snack tax in the next, like, 5 to 10 years?

Lauren: Yes, I think so. I think it’s an option. I think the soft-drinks taxes, generally, we considered a success. We need to see what impact it’s going to… If we can try and measure what impact it has had on health outcomes, but yes, I think certainly things like confectionery, sugar confectionery, and chocolate confectionery, where there’s again, like soft drinks, there’s no nutritional benefit to consuming these products, I think they really will be considered for the introduction of a tax.

Emily: This podcast was brought to you by Oxford Sparks from the University of Oxford, with music by John Lyons and a special thanks to Lauren Bandy and her excellent blanket for making skills.

If you want to see how we record this podcast, go to our social media. We are on the Internet: ‘@OxfordSparks’. You can also check out our website, ‘oxfordsparks.ox.ac.uk’. I’m Emily Elias. Bye for now.

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