Junk food tax to combat obesity
Wednesday, October 20th, 2010A recent publication by the medical Journal of Australia made a recommendation of a 10% tax on all junk food.
With Australia’s obesity rate now at 60% of Australians are overweight or obese.
The proposed introduction of a junk food tax is based on the findings by Monash University researchers established that junk food had the same misuse and costs to society as alcohol.
The proposed tax is aimed at changing the consumption habits by making the price point a determinant in deciding whether a purchase will take place.
The Federal Governments Preventative Health Taskforce also make a recommendation to introduce a tax against energy dense foods that takes into consideration “fatty” and “sugary” foods.
The Preventative Health Taskforce report also sited that the French Government was to increase their existing value added tax of 5.5% to19.6%, which will capture all foods high in fat, salt and sugar. The premise being that the tax would be applied to foods traditional perceived as being healthy, an example in Australia are the health/muesli bar market.
The great thing about this tax is it doesn’t have to discriminate, it is based purely on the fat, sugar and salt content of the processed food product.
So if their product is low in any of these nutrients, then their is nothing to worry about:))
The great things about the tax is:
1.Price affect demand based on peoples available money, with Australia credit card debt over 40Billion and house affordability creating mortgage stress, something has to give
2.Healthier options become more attractive as the price deferential isn’t as great
3.Big corporates like to maximise shareholder wealth so less demand = less $$$, so recipes will have to be adjusted to maintain sales levels.
However you really need to make junk food something consumed occasional rather than regularly so I would like to see a 50% junk food tax, a substantial increase to really effect buyer behavior.
This would be based on the products having the tax based on the % of fat, sugar and salt per 100gms being over an agreed amount. So instead of buying a chocolate bar every day, they may buy one every second or third day.
This would not impact on those suffering economic hardship as there are healthier cheaper options available.




