June 22, 2016
The Australian Greens party has introduced a proposed tax on sugary drinks in the lead up to the July 2 Federal Election.
As part of the proposed measures, the Greens seek to implement a blanket 20 percent “sugar tax” on sugar sweetened drinks, which are defined as ‘water-based drinks with over 5 grams of sugar per 100ml’. Tax would be paid by the producers or importers of sugar sweetened drinks, and not by the retailers.
Public Library of Science research, cited by the Greens, predicts that the proposed tax would:
Revenue generated by the tax is estimated to reach $500 million per year, which the Greens plan to reinvest in public and preventative healthcare, health education and restricting junk food advertising. The proposed measures go further than the tiered approach of the British Government, whose March 2016 levy applied a two tier level of taxation, based on the sugar content of the drink.
Senator Richard Di Natale, the leader of the Greens, has commented that “the sweetest part of the policy will be the longer-term benefits to Australians by reducing chronic disease and achieving better health outcomes”. In addition to the tax, the Greens are advocating a broader approach for tackling obesity, including clear food labelling, restricting junk food advertising to children and encouraging physical activity through active transport.
The Greens’ policy announcement has received widespread support from various community and health industry groups. However, agriculture and farming groups have expressed concerns on the impact such policy would have on regional jobs, sugar farmers, and the broader supply chain.
Less than 24 hours after the policy was announced, leading health advocacy groups and medical alliances have publicly voiced their support for the Greens’ sugar tax policy.
The Australian Medical Association (AMA) have praised the Greens’ tax on sugar drinks, stating that it is the first step in what should be a national obesity prevention strategy. The AMA’s statement aligns sugar with tobacco, stating that the Government should implement a similar approach for obesity prevention.
The Heart Foundation has called the Greens’ policy a “game changer”. Also aligning sugar with tobacco, the Heart Foundation argues that Australia should follow the UK’s head and “get on the front foot” to address rising obesity.
Public Health Association of Australia (PHAA) support the Greens’ approach investing the revenue generated from taxation in public health initiative, arguing that bipartisan support is necessary to enact real change.
Prevention 1st, an alliance of health professionals including the Foundation for Alcohol Research and Education (FARE), PHAA and Consumer Health Forum of Australia (CHF) have publicly applauded the Greens for adopting this policy, particularly the proposed reinvestment of tax revenue into obesity prevention.
Additional supporters of the Greens’ policy include the YMCA, Australian Dental Association, the Committee of Presidents of Medical Colleges and celebrity-chef, Jamie Oliver.
The Australian Food and Grocery Council, Canegrowers, the National Farmers Federation and Sugar Milling Council have united to voice concern on the detrimental impact the Greens’ proposed tax will have on the agricultural sector. Labelling the tax “an attack on 40,000 regional jobs”, the allies caution that a sugar tax would have a “massive reputation effect on 4,000 cane farming businesses” and impact the growth of rural economies.
Canegrowers Chairman, Paul Schembri, regards the tax as a “simplistic solution to a complex problem”, noting that targeting an individual food product would be ineffective in addressing the totality of health and wellbeing. Outside of just the sugar industry, Dominic Nolan, CEO of Sugar Milling Council says that the proposed tax could have a “significantly negative effect on the broader food sector” and consumers.
Both major political parties have confirmed they do not intend to pursue a sugar tax.
The Turnbull Government has said there is “zero chance” that they would introduce a sugar policy, with the party arguing that taxation is not the solution for every issue.
Finance Minister Mathias Cormann stated that “there are actually some things that are the responsibility of individual Australians, parents and families”. This sentiment is echoed by the Rural Health Minister Fiona Nash, whose spokesperson labelled the Greens’ policy “a lazy solution to a complex problem”.
Shadow treasurer Chris Bowen has confirmed that while the Labor party has sought advice on economic implications of a sugar tax, his party has no plans to pursue it. As part of their election campaign, Labor has instead pledged $10 million to introduce a National Nutrition Framework, which will expand the existing Health Star Rating system.
Labor frontbencher Katy Gallagher has also ruled out a sugar tax, instead outlining her party’s favored approach including a range of interventions to address childhood obesity including nutrition education, encouraging physical activities, and preventative health programs.
While a ‘sugar tax’ policy has been rejected by both sides of politics, it is likely that mounting public pressure will result in both parties introducing more stringent measures to improve the health of Australians.