Published Date : Feb 23, 2016
In a movement similar to the anti-tobacco campaign, some of the largest soda-consuming nations across Asia Pacific are considering to impose taxes on aerated drinks. The global soda industry has been under scrutiny with doctors and policy-makers blaming the fizzy drinks manufacturers for contributing towards the rising number of patients affected with diabetes and obesity.
Sugar Tax in Mexico and France Cuts Down Consumption of Aerated Drinks
A number of countries across the globe have introduced sugar tax to restrict people from consuming aerated drinks. Introduction of sugar tax in Mexico has led to a reported 12% decrease in the consumption of sugary drinks and has raised more than US$2 billion in tax receipts. Chile, France, and Berkeley in California have also implemented similar tax.
In the U.K., plans to introduce sugar tax have been scrapped and the manufacturers are expected to reformulate their products to decrease sugar content.
Sugar Tax across Asia Pacific to Adversely Impact Fizzy Drink Manufacturers
While cigarette manufacturers have negated the impact of stringent regulations across the developed regions by increasing their sales in emerging markets, it might prove tough for aerated drinks manufacturers to expand their business in Asia where a number of countries are considering the implementation of some form of sugar tax. In countries such as India, Indonesia, and Philippines, though the prevalence of obesity is lower than that of the U.S. and Europe, the governments are proposing sugar tax to curb the growing prevalence of obesity-related diseases. If the tax measures are implemented, the drink manufacturers would be expecting a big dent in their sales. However, industry analysts have pointed out that any new measures would deter multinational groups from investing in these nations.