Appendix 1. Excises on Unhealthy Food: A Brief Overview of the Health Literature
| Author | Type of study and main findings |
|---|---|
| Cause of obesity and definition of the tax base | |
| Vartanian and others (2007) | Meta-analysis based on 88 studies. Strong statistical relationship between soft-drink consumption, body weight and diabetes, as well as a negative impact on milk consumption. |
| Johnson and others (2009) | American Heart Association Scientific Statement. Small daily dietary imbalances (±125 calories, or 4 to 5 percent of daily caloric intake) cause long term effects on weight. Imbalances are brought by a few final consumption products with high concentration of specific base ingredient, most notably sugar (high-fructose corn syrup) in soft drinks. “Over the past 30 years, total calorie intake has increased by an average of 150 to 300 calories per day, and approximately 50% of this increase comes from liquid calories (primarily sugar-sweetened beverages)” |
| McGranahan and others (2011) | SSBs are a significant contributor to weight gain and discretionary caloric intake, they represented on average only 5.6 percent of total caloric intake among all Americans in 2007/08 (albeit with significant differences between population subgroups). |
| Mozaffarian and others (2011) | Cohort study of 120,877 non-obese (baseline) women and men from the USA. Weight gain was on average 3.35 lbs. per person per 4-year interval, and that weight gain was statistically associated with (in descending order): potato chips (1.69 lbs.), potatoes (1.28 lbs.), SSBs (1.00 lbs.), unprocessed red meat (0.95 lbs.), and processed meat (0.93 lbs.). Vegetables, whole grain, fruits, nuts and yogurt were associated with weight losses, as well as physical activity (21.76 lbs.). |
| Woodward-Lopez and others (2011) | Review of the literature. One-fifth of the weight increase in the US population between 1977 and 2007 is due to sweetened beverages. |
| Chriqui and others (2013) | Review of tax practices and policy options. The inclusion/exclusion of various products from the tax base is most likely going to require very granular understanding of market dynamic for a range of products, such as aspartame and saccharin-based drinks, less than 100% fruit juices, sports and energy drinks, lightly sweetened fizzling water, etc. |
| Bes-Rastrollo and others (2016) | Review of systematic reviews on: (1) SSBs and obesity; (2) metabolic adverse effects of fructose and SSB, and (3) the impact of SSB taxation on weight control. SSBs represent half of the added sugar intake in America (fruit drinks for children and sodas for adolescents and adults) and most studies conclude that they are a risk factor for obesity. The effect of taxes on weight gain is unclear, notably because of product substitution. Taxes on all SSBs could have a role as part of a multi-component strategy. |
| Drewnowski and Rehn (2014) | Cross-sectional study among 31,035 children, adolescents, and adults based on US surveys (2003–2004, 2005–2006, 2007–2008, and 2009–2010) to identify the source and form of consumed added sugar. Purchases in stores account for 65 to 76 percent of added sugar. Soda, energy and sports drinks account for 34.4 percent of added sugar, and fruit juices for 8 percent. |
| Impact of current taxes | |
| Smed and others (2007) | Estimation of a demand system for food in Denmark, using household-level panel data. Price sensitivity of various unhealthy food items changes with age and socio-economic conditions. |
| Powell and Chaloupka (2009) | Review of the literature on the impact of food and restaurant prices on weight outcomes. Small taxes and subsidies are unlikely to significantly affect Body Mass Index or prevalence of obesity. Higher taxes could have an impact on specific subgroups, such as children, adolescents, individuals with low socio-economic status, as well as for those at risk of obesity and overweight. |
| Powell and others (2009) | Individual-level panel data regression analysis. SSB taxes have no effect on adolescent Body Mass Index. |
| Fletcher and others (2010a) | Individual-level regression analysis on the effect of taxes on Body Mass Index. There is a significant but negligible effect of current soft drink taxes on adult weight. The effect is stronger for low-income individuals and Hispanics. |
| Fletcher and others (2010b) | Individual-level regression analysis on the effect of taxes on Body Mass Index and soft drink consumption. The effect of existing soft drink taxes on consumption is very small for children and adolescent and is fully offset by substitution towards other products (notably milk), hence no impact on obesity. Nevertheless, a 16 percent ad valorem tax on soft drinks could reduce consumption by 100 calories. |
| Sturm and others (2010) | Individual-level regression analysis on the effect of taxes on Body Mass Index and soft drink consumption. Taxing SSBs at current levels has very little impact, but sub-groups of at-risk children (overweight, low-income, African-American) are more sensitive. |
| Tiffin and Arnoult (2011) | Estimation of a demand system based on United Kingdom household food survey data, and simulation of the impact of a subsidy to fruits and vegetables combined with a tax on saturated fat. The impact of the tax on health is negligible. |
| Jou and Techakehakij (2012) | Review of obesity prevalence, tax rates and SSB consumptions in various countries. Various factors that could determine the impact of new taxes on weight, including the obesity rate itself (that is, how acute the problem is), the level of SSB (and other unhealthy food) consumption (that is, the scope for dietary improvement) and baseline tax rates (that is, potential to raise the current tax level). |
| Powell and others (2013) | Systematic review of the effects of price on consumption and weight outcomes. The studies that link soda taxes to weight outcomes show very little impacts on weight. |
| Chriqui and others (2014) | Compilation of taxes on unhealthy food in the USA, as of January 2014. Taxes were on average 5.2 percent among the 35 states that applied a sales tax on soft drinks (whether general sales tax or excise). |
| Cornelsen and others (2014) | Review of literature and meta-analysis on own-and cross-price elasticity in low-, middle-, and high-income countries. Own-price elasticities are larger in low-income countries. Cross-price elasticities vary widely and are highest in high income countries (see also Table 2). |
| Finkelstein and others (2014) | Review of the literature. Little evidence that targeted food taxes or subsidies alone could have a major effect on individual weight or obesity prevalence. |
| Batis and others (2016) | Use of consumer-level purchasing data to assess the impact of Mexico’s 8% tax on high-energy non-essential foods and 1 peso-per-liter tax on SSBs (that is, ±10% ad valorem) after one year of implementation. The impact of the tax on consumption was significant, but marginal (25 g per month per capita, or 70 to 110 calories), and substitution patterns and weight impact remain unclear. |
| Arantxa-Colchero and others (2017) | Use of consumer-level purchasing data to assess the impact of Mexico’s 1 peso-per-liter tax on SSBs (that is, ±10% ad valorem) after two years of implementation. Sales decreased by 8.2 percent for taxed beverages and increased by 2.1% for untaxed beverages. The impact was strongest among low socio-economic groups. Substitution patterns, impact on health and effects of other factors (concurrent information campaign) remain unclear. |
| Teng and others (2019) | Systematic review and meta-analysis of real-world sugar-sweetened beverage tax evaluations and related impact on purchases and dietary intake, based on 17 study outcomes. A hypothetical 10 percent tax on SSBs is associated with an equivalent average decrease in consumption and dietary intake, but there are considerable variations, which likely depend on the local context. The impact of the tax on non-taxed drink is not statistically significant. |
| Simulations for tax policy proposals | |
| Mytton and others (2007) | Use of elasticity, expenditure and consumption data from the United Kingdom’s 2000 National Food Survey and of meta-analysis-based biometric estimates to estimate the effect of extending the 17.5% United Kingdom VAT to various food categories. Applying the tax to three ever wider subsets of unhealthy food, authors concluded that a tax on a narrow subset of principal sources of saturated fat would decrease the intake of such fats, but that an increase in salt intake would offset the health benefits. Wider tax bases would bring the modest but tangible benefits of saving 2100 to 3200 deaths per year. |
| CBO (2008) | Use of existing price elasticity estimates to calculate the impact of a 0.25 cents tax per ounce on SSBs. Annual revenue would amount to USD 4 to 5 billion. |
| Brownell and others (2009) | Use of existing price elasticity and consumption estimates to calculate the impact of a 1 cent per ounce tax on SSBs (equivalent to 15 to 20 percent of the price of a 20-ounce bottle, or 12 cents on a standard size soft drink can). Calorie consumption would be reduced by 10 percent and estimated tax revenue increase by USD 14.9 billion. |
| Allais and others (2010) | Use of scanner data to estimate the demand for food in France and derive price- and “nutrient “elasticities”. A tax-induced price increase of 10 percent for a wide range of unhealthy food would result in a small decrease in caloric intake (for example, less than 20 calories per day per individual for cheese, butter and cream). However, the cumulative effect of small changes in calorie intake could amount to significant long-term gains, and a 10 percent tax could amount to a weight reduction of 2 to 3 kilograms after a decade. |
| Smith and others (2010) | Estimation of a demand system with individual-level and industry data. The decrease in SSBs induced by a 20 percent tax would be partly compensated by increased intake of juice, milk (among children), and mostly bottled water. The resulting weight loss would be on average 3.8 pounds after a year among adults, and 4.5 pounds among children. |
| Andreyeva and others (2011) | Use of existing price elasticity and consumption estimates to calculate the impact of a 1 cent per ounce tax on SSBs. The tax would generate USD 13.5 billion and reduce consumption by 24 percent (roughly 50 calories per day), hence a reduction of 5 pounds per year in body mass. |
| Edwards (2011) | Selective review of the literature to emphasize the importance of considering cross-price elasticities. The simulated impact on Body-Mass Index of a given tax using price elasticity estimates found in the literature is much lower for studies that take substitution pattern into account. |
| Dharmasena (2012) | Use of scanner data to estimate a demand system for various beverages. There are significant substitution patterns from SSBs towards fruit juices, low-fat milk, coffee and tea. Nevertheless, a 20 percent tax on SSB would reduce bodyweight by 1.54 to 2.55 pounds over a year. |
| Jensen and Smed (2013) | Use of household level data to assess the impact of the Danish tax on saturated fat on the level and place of purchase of taxed items. Tax-induced price changes in the range of 18–22 percent for butter, butter blends and margarine were associated with a 10 to 20 percent decline in consumption. Consumers appear to have shifted to discount stores. |
| Wang and others (2012) | Use of various existing estimates to calculate the impact of a 1 cent per ounce tax on SSBs. The tax would decrease health care cost by an average of USD 1.7 billion annually, in addition to raising USD 13 billion in revenue. |
| Briggs and others (2013) | Estimation of a demand system for sweetened drinks in the United Kingdom using individual data and simulation of the impact of a 20 percent tax. The tax would decrease prevalence of obesity in the United Kingdom by 1.3%. The effect would be only half of that in the USA, and substitution patterns appear to be widely different: whereas diet drinks and SSBs are complements in the USA, they are substitute in the United Kingdom. |
| Finkelstein and others (2013) | Use of scanner data to estimate a demand system for various food items. Increasing the price of SSBs by 20 percent would have little impact on consumed quantities of other products, except for fruit juice and to a lesser extent fat intake (for example, ice cream). The related average weight loss would be 1.6 pounds in the first year and 2.9 pounds over 10 years. |
| Dubois and others (2019) | Use of individual-level survey and household data to model “on-the-go” purchases of sugary and non-sugary drinks. A United Kingdom-style 25 p. per liter tax on sugary soft drinks would lower “on-the-go” soft-drink-related sugar intake by 195 g per person per year. The impact is stronger among youth and low-income individuals, but individuals with strong sugar preferences are relatively price insensitive. The reduction in caloric intake is mitigated by an increased consumption of non-taxed sugary drinks (125 g) and by food sources of sugar of a similar amount. |
| Author | Type of study and main findings |
|---|---|
| Cause of obesity and definition of the tax base | |
| Vartanian and others (2007) | Meta-analysis based on 88 studies. Strong statistical relationship between soft-drink consumption, body weight and diabetes, as well as a negative impact on milk consumption. |
| Johnson and others (2009) | American Heart Association Scientific Statement. Small daily dietary imbalances (±125 calories, or 4 to 5 percent of daily caloric intake) cause long term effects on weight. Imbalances are brought by a few final consumption products with high concentration of specific base ingredient, most notably sugar (high-fructose corn syrup) in soft drinks. “Over the past 30 years, total calorie intake has increased by an average of 150 to 300 calories per day, and approximately 50% of this increase comes from liquid calories (primarily sugar-sweetened beverages)” |
| McGranahan and others (2011) | SSBs are a significant contributor to weight gain and discretionary caloric intake, they represented on average only 5.6 percent of total caloric intake among all Americans in 2007/08 (albeit with significant differences between population subgroups). |
| Mozaffarian and others (2011) | Cohort study of 120,877 non-obese (baseline) women and men from the USA. Weight gain was on average 3.35 lbs. per person per 4-year interval, and that weight gain was statistically associated with (in descending order): potato chips (1.69 lbs.), potatoes (1.28 lbs.), SSBs (1.00 lbs.), unprocessed red meat (0.95 lbs.), and processed meat (0.93 lbs.). Vegetables, whole grain, fruits, nuts and yogurt were associated with weight losses, as well as physical activity (21.76 lbs.). |
| Woodward-Lopez and others (2011) | Review of the literature. One-fifth of the weight increase in the US population between 1977 and 2007 is due to sweetened beverages. |
| Chriqui and others (2013) | Review of tax practices and policy options. The inclusion/exclusion of various products from the tax base is most likely going to require very granular understanding of market dynamic for a range of products, such as aspartame and saccharin-based drinks, less than 100% fruit juices, sports and energy drinks, lightly sweetened fizzling water, etc. |
| Bes-Rastrollo and others (2016) | Review of systematic reviews on: (1) SSBs and obesity; (2) metabolic adverse effects of fructose and SSB, and (3) the impact of SSB taxation on weight control. SSBs represent half of the added sugar intake in America (fruit drinks for children and sodas for adolescents and adults) and most studies conclude that they are a risk factor for obesity. The effect of taxes on weight gain is unclear, notably because of product substitution. Taxes on all SSBs could have a role as part of a multi-component strategy. |
| Drewnowski and Rehn (2014) | Cross-sectional study among 31,035 children, adolescents, and adults based on US surveys (2003–2004, 2005–2006, 2007–2008, and 2009–2010) to identify the source and form of consumed added sugar. Purchases in stores account for 65 to 76 percent of added sugar. Soda, energy and sports drinks account for 34.4 percent of added sugar, and fruit juices for 8 percent. |
| Impact of current taxes | |
| Smed and others (2007) | Estimation of a demand system for food in Denmark, using household-level panel data. Price sensitivity of various unhealthy food items changes with age and socio-economic conditions. |
| Powell and Chaloupka (2009) | Review of the literature on the impact of food and restaurant prices on weight outcomes. Small taxes and subsidies are unlikely to significantly affect Body Mass Index or prevalence of obesity. Higher taxes could have an impact on specific subgroups, such as children, adolescents, individuals with low socio-economic status, as well as for those at risk of obesity and overweight. |
| Powell and others (2009) | Individual-level panel data regression analysis. SSB taxes have no effect on adolescent Body Mass Index. |
| Fletcher and others (2010a) | Individual-level regression analysis on the effect of taxes on Body Mass Index. There is a significant but negligible effect of current soft drink taxes on adult weight. The effect is stronger for low-income individuals and Hispanics. |
| Fletcher and others (2010b) | Individual-level regression analysis on the effect of taxes on Body Mass Index and soft drink consumption. The effect of existing soft drink taxes on consumption is very small for children and adolescent and is fully offset by substitution towards other products (notably milk), hence no impact on obesity. Nevertheless, a 16 percent ad valorem tax on soft drinks could reduce consumption by 100 calories. |
| Sturm and others (2010) | Individual-level regression analysis on the effect of taxes on Body Mass Index and soft drink consumption. Taxing SSBs at current levels has very little impact, but sub-groups of at-risk children (overweight, low-income, African-American) are more sensitive. |
| Tiffin and Arnoult (2011) | Estimation of a demand system based on United Kingdom household food survey data, and simulation of the impact of a subsidy to fruits and vegetables combined with a tax on saturated fat. The impact of the tax on health is negligible. |
| Jou and Techakehakij (2012) | Review of obesity prevalence, tax rates and SSB consumptions in various countries. Various factors that could determine the impact of new taxes on weight, including the obesity rate itself (that is, how acute the problem is), the level of SSB (and other unhealthy food) consumption (that is, the scope for dietary improvement) and baseline tax rates (that is, potential to raise the current tax level). |
| Powell and others (2013) | Systematic review of the effects of price on consumption and weight outcomes. The studies that link soda taxes to weight outcomes show very little impacts on weight. |
| Chriqui and others (2014) | Compilation of taxes on unhealthy food in the USA, as of January 2014. Taxes were on average 5.2 percent among the 35 states that applied a sales tax on soft drinks (whether general sales tax or excise). |
| Cornelsen and others (2014) | Review of literature and meta-analysis on own-and cross-price elasticity in low-, middle-, and high-income countries. Own-price elasticities are larger in low-income countries. Cross-price elasticities vary widely and are highest in high income countries (see also Table 2). |
| Finkelstein and others (2014) | Review of the literature. Little evidence that targeted food taxes or subsidies alone could have a major effect on individual weight or obesity prevalence. |
| Batis and others (2016) | Use of consumer-level purchasing data to assess the impact of Mexico’s 8% tax on high-energy non-essential foods and 1 peso-per-liter tax on SSBs (that is, ±10% ad valorem) after one year of implementation. The impact of the tax on consumption was significant, but marginal (25 g per month per capita, or 70 to 110 calories), and substitution patterns and weight impact remain unclear. |
| Arantxa-Colchero and others (2017) | Use of consumer-level purchasing data to assess the impact of Mexico’s 1 peso-per-liter tax on SSBs (that is, ±10% ad valorem) after two years of implementation. Sales decreased by 8.2 percent for taxed beverages and increased by 2.1% for untaxed beverages. The impact was strongest among low socio-economic groups. Substitution patterns, impact on health and effects of other factors (concurrent information campaign) remain unclear. |
| Teng and others (2019) | Systematic review and meta-analysis of real-world sugar-sweetened beverage tax evaluations and related impact on purchases and dietary intake, based on 17 study outcomes. A hypothetical 10 percent tax on SSBs is associated with an equivalent average decrease in consumption and dietary intake, but there are considerable variations, which likely depend on the local context. The impact of the tax on non-taxed drink is not statistically significant. |
| Simulations for tax policy proposals | |
| Mytton and others (2007) | Use of elasticity, expenditure and consumption data from the United Kingdom’s 2000 National Food Survey and of meta-analysis-based biometric estimates to estimate the effect of extending the 17.5% United Kingdom VAT to various food categories. Applying the tax to three ever wider subsets of unhealthy food, authors concluded that a tax on a narrow subset of principal sources of saturated fat would decrease the intake of such fats, but that an increase in salt intake would offset the health benefits. Wider tax bases would bring the modest but tangible benefits of saving 2100 to 3200 deaths per year. |
| CBO (2008) | Use of existing price elasticity estimates to calculate the impact of a 0.25 cents tax per ounce on SSBs. Annual revenue would amount to USD 4 to 5 billion. |
| Brownell and others (2009) | Use of existing price elasticity and consumption estimates to calculate the impact of a 1 cent per ounce tax on SSBs (equivalent to 15 to 20 percent of the price of a 20-ounce bottle, or 12 cents on a standard size soft drink can). Calorie consumption would be reduced by 10 percent and estimated tax revenue increase by USD 14.9 billion. |
| Allais and others (2010) | Use of scanner data to estimate the demand for food in France and derive price- and “nutrient “elasticities”. A tax-induced price increase of 10 percent for a wide range of unhealthy food would result in a small decrease in caloric intake (for example, less than 20 calories per day per individual for cheese, butter and cream). However, the cumulative effect of small changes in calorie intake could amount to significant long-term gains, and a 10 percent tax could amount to a weight reduction of 2 to 3 kilograms after a decade. |
| Smith and others (2010) | Estimation of a demand system with individual-level and industry data. The decrease in SSBs induced by a 20 percent tax would be partly compensated by increased intake of juice, milk (among children), and mostly bottled water. The resulting weight loss would be on average 3.8 pounds after a year among adults, and 4.5 pounds among children. |
| Andreyeva and others (2011) | Use of existing price elasticity and consumption estimates to calculate the impact of a 1 cent per ounce tax on SSBs. The tax would generate USD 13.5 billion and reduce consumption by 24 percent (roughly 50 calories per day), hence a reduction of 5 pounds per year in body mass. |
| Edwards (2011) | Selective review of the literature to emphasize the importance of considering cross-price elasticities. The simulated impact on Body-Mass Index of a given tax using price elasticity estimates found in the literature is much lower for studies that take substitution pattern into account. |
| Dharmasena (2012) | Use of scanner data to estimate a demand system for various beverages. There are significant substitution patterns from SSBs towards fruit juices, low-fat milk, coffee and tea. Nevertheless, a 20 percent tax on SSB would reduce bodyweight by 1.54 to 2.55 pounds over a year. |
| Jensen and Smed (2013) | Use of household level data to assess the impact of the Danish tax on saturated fat on the level and place of purchase of taxed items. Tax-induced price changes in the range of 18–22 percent for butter, butter blends and margarine were associated with a 10 to 20 percent decline in consumption. Consumers appear to have shifted to discount stores. |
| Wang and others (2012) | Use of various existing estimates to calculate the impact of a 1 cent per ounce tax on SSBs. The tax would decrease health care cost by an average of USD 1.7 billion annually, in addition to raising USD 13 billion in revenue. |
| Briggs and others (2013) | Estimation of a demand system for sweetened drinks in the United Kingdom using individual data and simulation of the impact of a 20 percent tax. The tax would decrease prevalence of obesity in the United Kingdom by 1.3%. The effect would be only half of that in the USA, and substitution patterns appear to be widely different: whereas diet drinks and SSBs are complements in the USA, they are substitute in the United Kingdom. |
| Finkelstein and others (2013) | Use of scanner data to estimate a demand system for various food items. Increasing the price of SSBs by 20 percent would have little impact on consumed quantities of other products, except for fruit juice and to a lesser extent fat intake (for example, ice cream). The related average weight loss would be 1.6 pounds in the first year and 2.9 pounds over 10 years. |
| Dubois and others (2019) | Use of individual-level survey and household data to model “on-the-go” purchases of sugary and non-sugary drinks. A United Kingdom-style 25 p. per liter tax on sugary soft drinks would lower “on-the-go” soft-drink-related sugar intake by 195 g per person per year. The impact is stronger among youth and low-income individuals, but individuals with strong sugar preferences are relatively price insensitive. The reduction in caloric intake is mitigated by an increased consumption of non-taxed sugary drinks (125 g) and by food sources of sugar of a similar amount. |
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Poor diet is also related to a host of other conditions, such as tooth decay, hypertension, etc., which are not the immediate focus of this How-to Note.
This represented 9.1 percent of health care expenditures – see Finkelstein (2009). For the USA, see also Cawley, (2010); and Cawley and others (2015), who provide a higher estimate of USD 315.8 billion for 2010. Shekar and Popkin (2020) provide estimates for a group of 13 middle- and high-income countries. Burden of disease estimates generally vary widely, depending on data and methodology.
Although “epidemic” has traditionally been used for infectious diseases, it is here given its modern meaning, that is, occurring in numbers in excess of normal expectancy, as compared to endemic or sporadic.
See for example the debate on the role of High Fructose Corn Syrup in the obesity epidemic (Lustig and others 2012; Bray and others 2004; and White 2009).
Positive externalities through the pension system – if obese people die sooner, there could be higher benefit for non-obese people – have not been discussed as much as in the case of tobacco externalities.
While non-insured USA citizens are a clear example of this, it is also useful to remember that in many middle- and low-income countries, despite a nominally universal health care system, the lack of resources often leads to a variety of sometimes large out-of-pocket payments, such as for drugs and other supplies or for faster and better treatment with completely private providers.
Such findings may raise additional equity concerns though, which are not covered here or by Bhattacharya and Bundorf (2009).
Comparing their results to earlier studies, Bhattacharyya and Sood (2005), point to a similar difference.
Interestingly, this literature points to links between internalities, corrective taxes and redistributive policies, given the relationship between internalities, imperfect information, self-control and education levels and socio-economic status.
In low-income countries, processed food or soft drinks are more likely to be consumed by the higher-income groups, and hence have a stronger equity rationale.
A part or more than the tax amount can be passed on to the consumers, depending on many factors, notably the price elasticity, the type of excises and industry structure, etc. This is an important topic that is not covered here, but that should be part of policy design.
Besides perhaps “Food away from home” Andreyeva and others (2010) does not have a category that could have been closely associated with consumption of excess fat, such as chips or fast food.
Products that can cause obesity must be identified to define a controllable tax base, taxes on these products must then be passed into higher prices, which in turn must significantly decrease overall consumption of unhealthy products (that is, considering substitution effects), and the decrease in consumption must be large enough to impact calorie intake.
Given the vast literature reviewed for this section, most texts used for this section are referenced and summarized in Appendix 1 to ease the reading.
As made clear by Taubes (2013), the link between obesity and caloric intake can also be complex to the point of challenging commonly held views on the nature of obesity as an imbalance between caloric intake and use.
This raises a series of additional questions on environmental tax on meat from beef and other grazing animals, given their large carbon footprint.
Relatedly, they also calculate that a tax on nutrients (sugar) has a larger impact, but administrative considerations of taxing nutrients are not discussed.
Documenting a strong complementarity between leisure and unhealthy food would in addition make the tax economically efficient.
Lakdawalla and Philipson (2002) notably emphasize the long-term impact of technological change, lifestyle and overall food prices on obesity, and estimate that lower food prices account for 43 percent of increase in the Body-Mass Index.
Zero-rating is usually reserved for exports in the standard destination-based consumption VAT systems. The input VAT in zero-rated products is fully credited, and reimbursed if necessary (see Ebrill, Keen, Bodin and Summers, 2001).
In fact, in some countries, local breweries will also manufacture other bottled beverages (under license), hence the easy step of extending an existing excise system to other production lines among the same taxpayers.
Perhaps even more so in countries, where religious practices prohibit or restrict alcohol consumption.
Excises often extend to bottled water for the same reasons.
For a more complete discussion, see Keen (1998), as well as Crawford, Keen and Smith (2010).
This deserves a broader reflection on the relative merits of regulation and taxation. For example, banning trans-fats has been a much more efficient solution than taxing them would have been, and similar solutions might be explored regarding sugar, for which there are non-caloric substitutes, although their long-term effects remain to be further investigated.