Fat taxes don’t work

Obesity is a growing problem, but punitive taxation would be ineffective and illiberal

Is a tax on soft drinks the best way to reduce their consumption? Research published in the British Medical Journal suggests it is, and that it would raise a handy £276m for the exchequer as well, enough to support many a local authority health club. The suggestion is for a 20 per cent levy, which would reduce the number of obese adults by 180,000. As Homer Simpson might ask of his favourite doughnuts: “What’s not to like?”

Nothing, except that it is fraught with practical difficulty, and would probably collapse under the obese bulk of its own contradictions. Away from the laboratory of social science, it is easy to see how consumer demand and a willing and inventive band of big soft-drink makers could conspire to frustrate such a tax. What, for example, is a “drink with added sugar”? Is that any addition of sugar, no matter how small? If so, it would treat lower sugar “diet” alternatives the same as their full-on alternatives, which seems perverse. Does it include drinks with other added sweeteners? And what about unadulterated smoothies and juices that, for all their purity, contain plenty of natural, non-added sugars in any case? If a certain threshold of added sugar were stipulated, then one can envisage a new range of drinks pitched at just below that level – not quite the revolution envisaged.

Even for the poorest households, would another 10p on the price of a bottle of Irn-Bru or Coke really make much difference? In which case maybe the sugar tax should be set higher. Punitive taxation certainly helped reduce tobacco consumption, but do we really want to see the £3 can of cola? Set the tax too high and we could see the sort of smuggling and black market activity that undermines the taxation of cigarettes and cheap spirits. And if we’re taxing sweet things, how about biscuits, cakes, chocolate, jam, tinned fruit in syrup, even tomato ketchup? What if the water and sugary flavourings were sold in separate bottles, ready to be mixed by excited children willing to experiment with tasty combinations? One can also foresee some lively legal battles over the status of honey.

Just as it took the courts decades to decide if a Jaffa Cake qualified as a cake (zero rated for VAT) or a biscuit (liable to VAT), with highly paid barristers and tax experts arguing the toss about the extent to which said Jaffa Cake could be defined as “chocolate covered”, similar levels of absurdity could easily overtake a sugar tax.

A better approach might be to make gluttony as socially unacceptable as cigarette smoking became, through intensive programmes of health education, and to take smaller, more realistic steps, to curb consumption, such as stopping schools stocking fizzy drinks in their vending machines. Health warnings on fast food and other “bad” foods could be introduced, and the food and drink makers encouraged to do still more to highlight fat and sugar content in labelling. The supermarkets should be shamed into moving the “impulse buy” bars of chocolate away from check-outs. The state can and should act to prevent obesity, diabetes and various cancers fostered by excessive sugar consumption. But the tax system, already complex and exasperating, is not the ideal weapon.