Most countries tax sugary drinks, but rates are too low to curb consumption, WHO report reveals

The World Health Organization's (WHO) recent report on sugar-sweetened beverage (SSB) taxes shines a crucial light on a global public health challenge: while many countries have adopted these taxes, their rates are often too low to effectively curb consumption. This issue is highly pertinent for India, a nation grappling with a rapidly escalating burden of non-communicable diseases (NCDs).

**Background Context: The Global Health Crisis and Fiscal Interventions**

For decades, the world has witnessed a dramatic shift in disease patterns. Non-Communicable Diseases (NCDs) such as type 2 diabetes, cardiovascular diseases, certain cancers, and obesity have become the leading causes of mortality and morbidity globally. A significant driver of this epidemic is unhealthy diets, particularly the excessive consumption of sugar. Sugar-sweetened beverages, including sodas, energy drinks, and sweetened juices, are major contributors to caloric intake without providing substantial nutritional value. Recognizing this, the WHO has long advocated for fiscal policies, specifically taxes on SSBs, as a cost-effective intervention to reduce their consumption and improve public health outcomes. The idea is rooted in behavioral economics: making unhealthy options more expensive can discourage their purchase, especially among price-sensitive populations.

**What the WHO Report Reveals**

According to the WHO report, over half the world's countries have now implemented taxes on SSBs. This widespread adoption signals a global consensus on the potential of such measures. However, the report’s critical finding is that these taxes typically represent only a small fraction of the retail price of these beverages. This low levy renders them largely ineffective in significantly influencing consumer purchasing habits. For a tax to be effective in reducing consumption, it needs to be high enough to create a noticeable price change, which then leads consumers to buy less or switch to healthier alternatives. The report implicitly suggests that many existing SSB taxes are more revenue-generating mechanisms than genuine public health interventions.

**Key Stakeholders Involved**

Several key players are central to this global discussion. The **World Health Organization (WHO)** is a primary advocate, providing evidence-based recommendations and monitoring global health trends. **National Governments**, through their health and finance ministries, are crucial for policy formulation and implementation, balancing public health objectives with economic considerations and potential revenue generation. The **Beverage Industry** (manufacturers and distributors) is a significant stakeholder, often opposing such taxes, citing potential job losses, economic impact, and advocating for voluntary reformulation or educational campaigns instead. **Public Health Advocates and Civil Society Organizations** actively campaign for stronger fiscal measures, highlighting the long-term health and economic benefits. Finally, **Consumers** are directly impacted by both the prices of SSBs and the health consequences of their consumption.

**Significance for India**

India faces an alarming NCD crisis. It is often referred to as the 'diabetes capital' of the world, with millions suffering from the disease. Obesity rates are also on the rise, even among children. The economic burden of treating these diseases is colossal, straining both public and private healthcare systems. For India, the WHO report's findings are particularly pertinent. While India does not have a specific 'health-oriented' SSB tax, sugar-sweetened beverages fall under the highest 28% Goods and Services Tax (GST) slab, often accompanied by an additional compensation cess, effectively treating them as 'sin goods' or 'demerit goods'. However, this is primarily a revenue measure, and whether the combined tax burden is sufficient to significantly alter consumption patterns for public health purposes is a subject of ongoing debate. Implementing a dedicated, sufficiently high SSB tax could be a powerful tool to combat India's NCD epidemic, potentially generating revenue that could be earmarked for health initiatives.

**Constitutional and Policy Context in India**

From a constitutional perspective, **Article 47** of the Directive Principles of State Policy (DPSP) mandates that the State shall regard the raising of the level of nutrition and the standard of living of its people and the improvement of public health as among its primary duties. This provides a strong constitutional basis for public health interventions, including fiscal measures like SSB taxes. The **Goods and Services Tax (GST)**, introduced via the **101st Constitutional Amendment Act, 2016**, governs indirect taxation in India. While SSBs are taxed under GST, a specific health cess or an increase in the effective tax rate specifically designed to deter consumption would require careful consideration within the GST Council. The **National Health Policy 2017** also emphasizes the prevention and control of NCDs through multi-sectoral action, including promoting healthy lifestyles and addressing risk factors. The **Food Safety and Standards Authority of India (FSSAI)** also plays a role in regulating food products, including labeling and nutritional guidelines, which complements fiscal measures.

**Future Implications**

The WHO report serves as a call to action. It suggests that countries that have already implemented SSB taxes should evaluate their effectiveness and consider increasing the rates to at least 20% of the retail price, as recommended by the WHO. For countries like India, it prompts a deeper discussion about whether the current tax structure is achieving public health goals or if a more targeted and impactful fiscal intervention is needed. Future implications include potential policy shifts globally towards higher SSB taxes, increased focus on earmarking tax revenues for health programs, and continued industry pushback balanced by growing public health advocacy. Ultimately, effective SSB taxation could lead to significant reductions in NCD prevalence, alleviating healthcare burdens and improving the overall health and productivity of the population.