Use economic tools

Use economic tools to address food affordability and purchase incentives

This table provides examples of the types of policy actions that can be taken within this policy area, examples of where these policy actions have been implemented, and a brief description of what the action involves. It provides a global snapshot, largely of policies already implemented; it is not necessarily comprehensive. The examples were collated through a review of international reports of policy actions around the world, academic articles reporting on policy actions, and online government resources.

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Examples of policy actions Examples of where implemented What the action involves
Health-related food taxes Barbados

In June 2015 the Government of Barbados passed a 10% excise tax on locally produced and imported sugary drinks, including carbonated soft drinks, juice drinks, sports drinks and others. Drinks exempt from the tax include 100% natural fruit juice, coconut water, plain milk and evaporated milk. The tax came into effect 1 August 2015 and will be reviewed after two years. Revenue from the tax will be directed to the health sector.

Belgium

In December 2015, the Belgian government increased the excise duty on soft drinks by 0.03 euros per litre as part of a general ‘health tax’ (Law on measures to strengthen job creation and purchasing power - 26 December 2015). The now 0.068 euro per litre excise duty came into effect 1 January 2016 and is applied to all soft drinks, including non-alcoholic drinks and water containing added sugar or other sweeteners or flavours. An excise duty is also applied to any substance intended for the use of manufacturing soft drinks (liquid: 0.41 euros/litre, powder: 0.68 euros/1kg).

INFORMATION UPDATED 07/03/2016

Chile

In effect since 1 January 2015, an 18% ad valorem tax is applied to sugary drinks with sugar content greater than 6.25 g of sugar per 100 mL. Prior to this, a 13% ad valorem tax was applied to these sugary drinks since 1 October 2014. Sugary drinks include all non-alcoholic drinks with added sweeteners including energy drinks and waters. Sugary drinks with less than 6.25 g of sugar per 100 mL are taxed at 10%.

Dominica

In effect since 1 September 2015, a 10% excise tax is applied to food and drinks with high sugar content. This includes sweets, candy, chocolate bars, soft drinks and other sweetened drinks (including energy drinks). Revenues from the tax will contribute to a national “Get Healthy” campaign.

Finland

Like many countries, Finland imposed excise taxes on non-alcoholic beverages and confectionery for most of the 20th century for revenue-raising purposes. The excise duty on confectionery was removed in 2000, but re-introduced in 2011. Currently taxes are levied on confectionery, chocolate and ice cream in addition to non-alcoholic beverages. In 2014, the tax rate was EUR 0.95/kg by weight for confectionery and ice cream, EUR 0.220/L for beverages with more than 0.5% sugar and EUR 0.11/L for other non-alcoholic beverages. Producers with an annual production volume of less than 10,000 kg or 50,000 litres are exempted from the tax. Beginning January 2017, the tax on candy and ice cream will be removed. The tax on non-alcoholic beverages will remain.

INFORMATION UPDATED 07/03/2016

France

In effect since 1 January 2012, the French soda tax is an excise duty applied to drinks with added sugar and artificial sweeteners, including sodas, fruit drinks, flavoured waters and ‘light’ drinks (Law no 2011-1977). The tax is around 11 euro cents per 1.5 litres of soda and used to raise revenue for the general budget.

French Polynesia

Various food and beverage taxes have been in place since 2002 to discourage consumption and raise revenue e.g. domestic excise duty on sweetened drinks and beer; import tax on sweetened drinks, beer and confectionery; tax on ice cream. Between 2002 and 2006, tax revenue went to a preventive health fund; from 2006, 80% has been allocated to the general budget and earmarked for health. The tax is 40 CFP (around $0.44) per litre on domestically-produced sweet drinks, and 60 CFP (around $0.68) per litre on imported sweet drinks.

Hungary

A "public health tax" adopted in 2012 is applied on the salt, sugar and caffeine content of various categories of ready-to-eat foods, including soft drinks (both sugar- and artificially-sweetened), energy drinks and pre-packaged sugar-sweetened products. The tax is applied at varying rates. Soft drinks, for example, are taxed at $0.24 per litre, and other sweetened products at $0.47 per litre. The tax also applies to products high in salt, including salty snacks with >1g salt per 100g, condiments with >5g salt per 100g and flavourings >15g salt per 100g.

Mauritius

Since 1 January 2013, an excise tax must be applied on the sugar content of all soft drinks, whether imported or produced domestically. Soft drinks are defined as any aerated beverage, syrups, and fruit squashes, cordials and drinks. Fruit and vegetable juices and drinks containing only artificial sweeteners are excluded from the tax, as are soft drinks produced for export only. For 2014, the tax amounts to MUR 0.3 ($0.01) per gram of sugar content, up from MUR 0.2 in 2013 ($0.006).

Mexico

In December 2013, the Mexican legislature passed two new taxes as part of the National Strategy for the Prevention and Control of Overweight, Obesity and Diabetes (Estrategia Nacional Para Un Mexico Sin Obesidad). They entered into force on 1 January 2014. An excise duty of 1 peso ($0.07) per litre applies to sugary drinks. Sugary drinks are defined under the new law as all drinks with added sugar, excluding milks or yoghurts. Preliminary price monitoring indicates that the price of sugary drinks has increased by around 10%. The revenue from the sugary drink tax should be allocated to fund programmes addressing malnutrition, obesity and obesity-related chronic diseases, as well as access to drinking water (6th transitory article, Federal Law on Income for the Fiscal Year 2014); however, the revenue is currently being allocated to the general budget. An ad valorem excise duty of 8% applies to foods with high caloric density, defined as equal to or more than 275 calories per 100 grams. The food product categories that are affected by the tax include chips and snacks, confectionery, chocolate and cacao based products, puddings, peanut and hazelnut butters.

Samoa

Soft drinks, both imported and locally produced, have been taxed since 1984. From 1984 until 2008, the excise tax amounted to 0.3 Samoan Tala per litre (around $0.12); in 2008 the rate changed to 0.4 Samoan Tala per litre (around $0.17).

In 2007, Samoa imposed a ban on high fat turkey tails. In 2012 the ban was lifted when Samoa joined the World Trade Organization and a 300% import duty was set for two years followed by a 100% import duty.

St Helena

In effect since 27 May 2014, a £0.75 per litre excise duty (about $1.14) is applied to high-sugar carbonated drinks in St Helena (Customs and Excise Ordinance Chapter 145, Section 5). High sugar carbonated drinks are defined as drinks containing ≥15 grams of sugar per litre.

Tonga

As of 2013, soft drinks containing sugar or sweeteners are taxed at 1 Tonga Pa’anga per litre (around $0.50). Animal fat products (e.g. lard and drippings) are taxed at $1 per kilogram.

United States

In November 2014, the city of Berkeley, California passed a law (Ordinance 7388-NS) taxing sugary drinks that came into effect 1 January 2015. An excise duty of $0.01 per fluid ounce of a sugar-sweetened beverage applies to soda, energy drinks and heavily presweetened tea, as well as to the “added caloric sweeteners” used to produce them (note: tax on an ounce of ‘added caloric sweeteners” would be significantly more than $0.01). Infant formula, milk products, and natural fruit and vegetable juices are exempted.

In November 2014, the Navajo Nation adopted the “Healthy Diné’ Nation Act” (Legislation No CN-54-14) into law. It includes a 2% tax on “minimal-to-no-nutritional value food items”, including sugar-sweetened beverages, prepackaged and non-prepackaged snacks stripped of essential nutrients and high in salt, saturated fat and sugar including sweets, chips and crisps. The tax was implemented 1 April 2015. Revenue from the tax is earmarked for the Community Wellness Development Projects Fund and used for projects such as farming, vegetable gardens, greenhouses, farmers markets, healthy convenience stores, clean water, exercise equipment and health classes. The tax is collected through self-reporting.

Voluntary health-related food taxes United Kingdom

As part of the #SugarSmartCity campaign (see “I” – ‘Inform people’ for details), Brighton & Hove City Council is promoting a voluntary ‘sugar tax’. The City Council actively encourages food outlets to adopt a voluntary £0.10 levy (around $0.15) on all non-alcoholic sugar-sweetened drinks sold. Money raised from the voluntary levy goes to the Children’s Health Fund, set up by Sustain: the Alliance for Food and Farming in partnership with Jamie Oliver in August 2015, to support food education and health initiatives for children.

Increasing import tariffs on specified "unhealthy" foods Cook Islands
Fiji
French Polynesia
Nauru
Samoa

These countries have all introduced import duties on either soft drinks or sugar; Nauru also taxes high-sugar foods. These are either charged ad valorem (Cook Islands – 15% with a subsequent 2% rise per year – since 2013; Fiji – 32%, since 2011; Nauru – 30%, since 2007) or on a certain volume or weight of goods (French Polynesia – around $0.68 per litre for imported drinks since 2002, and Samoa – around $0.17 per litre since 2008).

Fiji

Fiji has an import duty on palm oil and monosodium glutamate of 35% implemented in 2012.

Lowering import tariffs on specified "healthy" foods Tonga

In 2013, as part of a broader package of fiscal measures, import duties were lowered from 20% to 5% for imported fresh, tinned or frozen fish in order to increase affordability and promote healthier diets.

Fiji

Fiji has removed original import and excise duty (set at 5-32%) on fruits and vegetables which are not locally grown to promote vegetable and fruit consumption.

Targeted subsidies for healthy foods* United Kingdom

The Healthy Start programme provides pregnant women and/or families with children under the age of four with weekly vouchers to spend on foods including milk, plain yoghurt, and fresh and frozen fruit and vegetables. Participants or their family must be receiving income support/jobseekers allowance or child tax credits. Pregnant women under the age of 18 can also apply. Full national implementation of the programme began in 2006.

United States

In 2009, the U.S. Department of Agriculture (USDA) implemented revisions to the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) to improve the composition and quantities of WIC-provided foods from a health perspective.

In 2012, the USDA piloted a "Healthy Incentives Pilot" as part of the Supplemental Nutrition Assistance Program (SNAP, formerly "food stamps"). Participants received an incentive of 30 cents per US$ spent on targeted fruit and vegetables (transferred back onto their SNAP card).

The New York City Health Department District Public Health Offices distribute 'Health Bucks' to farmers’ markets (launched in 2006). When customers use income support (e.g. Food Stamps) to purchase food at farmers' markets, they receive one 'Health Buck' worth $2 for each $5 spent, which can then be used to purchase fresh fruits and vegetables at a farmers’ market.

*Private insurance providers also offer private subsidy schemes. For example, South Africa’s largest private health insurer, Discovery Health, runs the cash back rebate programme "Vitality", in which healthier items purchased in food shops receive a 10% discount.

Table last updated: 07/03/2016


Copyright © 2016 World Cancer Research Fund International. Please send any feedback to policy@wcrf.org and acknowledge World Cancer Research Fund International as the originators. 

A number of other organisations also provide access to policy databases. Some are listed below:

International
WHO Global Database on the Implementation of Nutrition Action

European
WHO Europe Database on Nutrition, Obesity and Physical Activity

United States
The Rudd Center for Food and Obesity – Legislation Database
National Association of State Boards of Education – State School Health Policy Database
National Cancer Institute – Classification of Laws Associated with School Students
Centers for Disease Control – Chronic Disease State Policy Tracking System

Canada
Prevention Policies Directory