Food taxes and subsidies: A balanced approach needed, says review

By Nathan Gray

- Last updated on GMT

Taxes on unhealthy foods, in conjunction with subsidies for healthy foods, can provide a valuable contribution to driving dietary changes, say researchers.
Taxes on unhealthy foods, in conjunction with subsidies for healthy foods, can provide a valuable contribution to driving dietary changes, say researchers.

Related tags Nutrition

Fiscal policies can form a valuable part of efforts to drive changes in dietary behaviours, but such policies must be balanced against each other, say researchers.

A systematic review of more than 75 studies, to assess the true evidence base for the effect that subsidies and taxes have on food consumption and health, has found that fiscal policies including taxation of unhealthy foods and subsidies of healthy items can change dietary behaviours at population level.

Writing in the journal Nutrition​, the team behind the study reported that the majority of studies reviewed showed evidence of effectiveness at increasing the consumption of healthier foods and lowering purchases of food high in fat, sodium, and sugar.

“When taken as a whole, the breadth of articles included in this review provide consistent moderately strong evidence that taxation and subsidy policies can be effective for improving population dietary behaviours,”​ wrote the team – led by Dr Mark Niebylski of the World Hypertension League.

“To maximise success and effect, this review suggests that food taxes and subsidies should be a minimum of 10 to 15% and preferably used in tandem,”​ they concluded.

They noted that although ‘many research questions remain’ about the health effect and cost benefit of healthy food subsidies and unhealthy food taxation, the overall findings from the review “supports their implementation on a population-wide basis.”

However, Niebylski and his colleagues also warned that the prior or simultaneous implementation of further education and marketing about healthy eating, in addition to supportive pricing policies “are likely to be critical success factors.”

Balanced policies

Despite an overall recommendation that combination fiscal policies that include taxation and subsidies can alter behaviours, the authors warned that there need to consider the socio-economic inequalities in nutrition because of changes in prices from food tax and/or subsidies.

“A recent study indicated that low-income French women derived fewer financial and nutritional benefits from implemented food subsidies and taxes than medium-income women, though diet quality was improved,”​ warned Niebylski and his team.

They added that interventions to improve diet “needs to be framed within larger national polices to reduce poverty and more if inequalities increase,”​ adding that substitution patterns with non-taxed products can potentially undermine the intended benefit or effectiveness of food taxes if used as a sole strategy.

“Future research should assess the effect of an unhealthy food taxes on low income and other vulnerable groups and examine at what point such a tax may become regressive as well as what strategies will offset any negative effects.”

Niebylski and colleagues also noted that ‘even greater challenges’ are in store for low to middle income countries considering adopting such measures.

“Nevertheless, such challenges should not preclude countries from taking action,”​ they said.

“The available literature presents some clear themes and effective recommendations, which can inform the development and implementation of a food subsidy/tax intervention to the benefit of societies as a whole with the acknowledgment that questions persist on the extent of the public health effect.”

Source: Nutrition
Volume 31, Issue 6, June 2015, Pages 787–795, doi: 10.1016/j.nut.2014.12.010
“Healthy food subsidies and unhealthy food taxation: A systematic review of the evidence”
Authors: Mark L. Niebylski, et al

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