UPM To Study Sugar Tax

Sugary-drink purchases dropped by an average of 7.6 percent in the two years after Mexico imposed a sugar tax in 2014.

KUALA LUMPUR, March 26 – Universiti Putra Malaysia (UPM) will conduct a study on the effect of a tax on sugary drinks that will be imposed in July, the Health Ministry said today.

Health Minister Dzulkefly Ahmad told Parliament that the public university would examine this year the price elasticity for sugar-sweetened beverages in Malaysia.

“This study is meant to identify the effects of the tax increase on requests for or consumption of sugary drinks, especially among Malaysians, and so on to understand the average results for the country after this tax is implemented,” Dzulkefly told Permatang Pauh MP Nurul Izzah Anwar in a written parliament reply.

“Besides that, data on the trend of reduced consumption of sugary drinks can be obtained from the National Health and Morbidity Survey that is conducted periodically by the Public Health Institute.”

Dzulkefly said the tax on sodas and other sugary beverages was meant to reduce obesity rates in Malaysia, pointing out that 17.7 per cent of adults in Malaysia, or 3.3 million adults, were obese according to the National Health and Morbidity Survey 2015.

The 2015 survey also revealed that 17.5 per cent of the adult population in Malaysia, or 3.5 million adults, had diabetes.

“By imposing a tax on sugary drinks, which will subsequently increase the price of such drinks, this will reduce the consumption of sugary drinks among Malaysians,” said Dzulkefly.

“This will educate the public to choose healthier and cheaper drinks. A change in diet will help weight loss and subsequently cut the risk for obesity and chronic diseases like diabetes. This initiative will also encourage the reformulation of products to reduce sugar content in beverages.”

When Nurul Izzah asked about the Health Ministry’s plans to provide replacement beverages as the poor were found to be the biggest consumers of sugary drinks, Dzulkefly said his ministry would work with other ministries.

“This so that finally, we get to see healthy food served at schools like primary schools or even universities and whatever settings,” Dzulkefly told Parliament.

The Amanah lawmaker cited Mexico as an example, claiming that studies showed consumption of sugary drinks fell by 10 to 12 percent a year after the country imposed a tax on sugar-sweetened beverages in 2014.

The Guardian, however, reported that Mexico, where Coca-Cola is more ubiquitous than water, experienced a 5.5 percent drop in sugary-drink purchases in the first year after the sugar tax was imposed, followed by a 9.7 percent decrease in the second year, averaging 7.6 percent in the two-year period.

The scientists were quoted saying that they could not yet estimate the effect of the sugar tax on health.

Malaysia’s sugar tax will see a 40 sen tax per litre on soft drinks with more than five grams of sugar or sugar-based sweetener per 100ml, including carbonated drinks, flavoured and non-alcoholic beverages. Juices or vegetable-based drinks with over 12 grams of sugar per 100ml will also be taxed 40 sen per litre.

The Galen Centre for Health and Social Policy has questioned if the tax on sugary drinks will inadvertently encourage consumers to switch to sweet untaxed beverages like “teh tarik”.

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