Estonia gives green light to tax sugared soft drinks

By Will Chu

- Last updated on GMT

©iStock/piotr_malczyk
©iStock/piotr_malczyk
The Estonian Parliament are to introduce a levy to limit the consumption of sugar-sweetened soft drinks to try to rein in rising cases of obesity, type 2 diabetes, heart disease and stroke.

Estonia join a host of other countries within the EU that have approved legislation designed to curb sugar intake through a multi-tiered taxation approach.

Countries, which have already joined calls by the World Health Organization (WHO) to tax sugary drinks, include France and Hungary.

Countries such as United Kingdom (UK) and Ireland are about to introduce a levy, which charges a tax according to sugar content.

“This is a commendable step forward in tackling obesity in Estonia and is consistent with international guidance from WHO,”​ said Dr Marge Reinap, Head of the WHO Country Office in Estonia.

“The adoption of this measure is a show of the Government’s commitment to promote healthy diets, tackle obesity and improve health in the long run. We hope that Estonia continues along this path with implementation of other efficient measures to halt the rise in obesity.”

The move to improve the nation’s health comes after European statistics bureau, Eurostat, identified the country as one of the most obese nations in the European Union.

It stated that 20.4% of the population aged 18 and over as being obese. In comparison, Malta came top with 26% of the adult population being obese.

Latvia came in second with 21.3%, Hungary third (21.2%) with Estonia fourth. The UK recorded 20.1% of its adult population being obese.

Tax ins and outs

From 1 January 2018, tax will be introduced on non-alcoholic beverages. These include carbonated and non-carbonated drinks, 100% juice drinks and sweetened milk drinks.

Tax bands have been set for sugared beverages and those flavoured with artificial sweeteners.

Products with sugar content of 5–8 grams (g) per 100 millilitres (ml) will have a tax rate of 10 euro cents per litre.

Beverages with sugar content of more than 8 g per 100 ml will have a tax rate of 30 euro cents per litre.

Products with only artificial sweeteners will have a tax rate of 10 euro cents per litre.

Beverages with artificial sweeteners, sugar and sugar content of 5–8 g per 100 ml will have a tax rate of 20 euro cents per litre.

Products with artificial sweeteners, sugar and sugar content of more than 8 g per 100 ml will have a tax rate 30 euro cents per litre.

Gradual introduction

WHO said that the tiered tax gradient was put in place to stimulate product reformulation over time.

The highest tax rate of 30 euro cents per litre will be introduced gradually for products containing more than 10 g of sugar per 100 ml.

WHO added that in 2019 the threshold would move down to products with more than 9 g per 100 ml in 2019 with a further adjustment in 2020 planned for products with more than 8 g per 100 ml.

For 100% juice drinks and sweetened milk drinks, Estonia will seek state aid assistance from the European Commission.  If this is granted these products will be tax exempt.

Despite its intentions, the introduction of a sugar levy on soft drinks has come under a degree of criticism.

UK-based drinks producers described government plans to tax beverages as "patronizing, regressive and the nanny state at its worst."

Glasgow University carried out research involving 132,000 adults that found a sugar focus led consumers into neglecting fat intake as an important factor in reducing obesity.

UK campaigners have recently called for the sugar tax to address childhood obesity by including confectionery in its range of taxable products.

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