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Valerie Orsoni

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The French Soda Tax, a Fizzling Measure

Posted: 09/06/11 10:55 AM ET

Higher tax on soft drinks is one of the most unexpected measures for the French budget deficit austerity plan published last week. The objective seems credible: to fight against obesity. But is this really effective?

With annual costs accounting for 2% of health expenditure in France -- that is 4 billion Euros -- obesity-related diseases are rapidly increasing on French territory as well as worldwide. The rise of obesity is mainly related to an increasingly sedentary lifestyle and the expansion of malbouffe or in English, "bad food," with the government -- unable to reverse this alarming tendency -- attempting to at least slow it down somewhat.

Between educating the masses and punition, the chosen solutions are always criticized by one side or the other, like this recent measure included in the debt reduction plan published last week: The famous tax on sodas and other drinks containing added sugar, beginning January 1st, 2012.

A drop of water in an ocean of debts

The Prime Minister, François Fillon, justifies his proposal by relying on the World Health Organization figures which indicate that "obesity, which reached 8.5% in 1997, is now close to 15%" -- a progression of more than 70% in 12 years.

The 120 million Euros which this measure should generate for the French Health Fund represents a drop of water in an ocean of debts, and will not cause any behavioral changes in society, since its impact will be only one cent per can (going from 0.79 Euros to approximately 0.80 Euros). Even our current Minister of Health, Xavier Bertrand, in 2008 discussions on a proposed nutritional tax (at the time Minister of Labor) clearly stated: "This will increase prices; I am not sure this will change behaviors."

Thus, what this tax will really achieve: Reassure the financial markets, make consumers believe that their health matters to the government, and bring back a meager few million Euros. But will the consumer, instead of succumbing to sugary beverages and thus con-su-me (and pay more tax), opt for water? Certainly an idealistic dream, and one which should improve the population's health, according to François Fillon and Nora Bera, Secretary of State for Health. But in all seriousness, how can the government tax sweetened drinks in the hopes of generating more revenues, while at the same time anticipating that consumers buy less of these unhealthy products? Unless one is schizophrenic, this plan simply holds no ground.

Aspartame: more dangerous than sugary beverages

Nevertheless, if one explores this measure yet further, one can well speculate that consumers who want to save a few cents per week will, as an alternative, opt for sodas sweetened with aspartame, an artificial sweetener more and more criticized by health professionals, to the point where the European Union has advanced its examination of this food adjuvant to 2012.

If, at the time of this examination, the risks related to the consumption of the aspartame are revealed, proven, and accepted once and for all, the French government will have passed a tax measure on a product leading to obesity (an element on which not all health specialists are in agreement) in favor of a product with known side effects that can be detrimental to public health.

For the 120 million Euros reported, how much money will have to be spent to cover the health costs of consumers suffering from diseases related to the consumption of aspartame? What's more, according to an independent 10-year study by Katherine Appelton, researcher at Queen's University Belfast, the consumption of an aspartame sweetened drink before a meal increases the caloric value of the food by 150 calories (because of an insulin reaction due to the aspartame). [Sic]


A tax which does not take into account the global problem of malbouffe or unhealthy food

This tax, outside the general context of the fight against obesity, will not have any impact on the consumption of sweetened products. It demonizes food in an illogical way, stigmatizing a single food product while ignoring entire categories of junk food: chips, fatty cakes, imbalanced frozen meals, pizza, fries, etc. It is astonishing that Matignon concentrates only on sweetened drinks, branding them like cigarettes or alcohol, without taking the time to create a holistic program that addresses all aspects of healthy dietary habits.

For this reason the Food Producers National Association (Association Nationale des Industries Alimentaires, ANIA) reacted hard last Thursday to this tax, which they consider scandalous (inevitably): "To tax certain foodstuffs on the basis of arguments regarding public health, while at the same time these products are authorized on the market is purely and simply illogical and scandalous".

Implementable solutions which go beyond a simple tax

To fundamentally tackle the problem of national debt via the health of French citizens, it is important that the government launch a genuine reform initiative for advertizing sweetened and fatty products, menus offered in cafeterias, children's nutritional education (not sponsored by the food industry) and school fitness programs, as well as, paradoxically, reduce the VAT on fruits and vegetables -- to date at 19% -- whereas the fast-food industry, comprised of hamburgers, fried foods, and sweetened drinks is taxed only at 5.5%.

Indeed, a rebalancing of the taxes, with 5.5% on healthy produce (fresh fruit and vegetables, natural products), and 19% on nonessential foods (cakes, sodas, candies, etc.) could be a logically acceptable solution by all since the total effect on the shopper's bank account would be null. Lastly, rather than to impose a regressive tax that is not equitable and impacts only the wallet of modest household, why not impose rules on the food industry like a reduction in the fat and sugar content of food products, following what was successfully achieved for trans fatty-acids?

 
 
 

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