Samoa, Pacific lead in taxing sugary drinks: study

Pacific nations including Samoa are leading the way in the region with taxes on sugary drinks in a bid to address obesity and non-communicable diseases.

Research led by New Zealand’s University of Otago, which was undertaken by Otago and Pacific-based researchers and published early this month in the Australian and New Zealand Journal of Public Health, showed about three quarters of Pacific jurisdictions have sugary drink taxes and more than of third of them had increased the taxes by at least 20 per cent in the past two decades.

The study primarily focused on 21 Pacific Island countries and territories including Samoa, American Samoa, Marshall Islands, Tuvalu, French Polynesia, Kiribati, Northern Mariana Islands and Guam. And its goal was to "systematically characterise sugar-sweetened beverage (SSB) tax policy changes in Pacific Island countries and territories (PICTs) from 2000 to 2019."

University of Otago Senior Research Fellow, Dr Andrea Teng said in a statement released by the university that the increases in the taxes are expected to reduce soft drink consumption, and therefore help control obesity and related diseases.

She said sugary drink taxes are one of the most widely used interventions for obesity prevention in the Pacific region and there is clear evidence that taxes can improve diets, and this helps to prevent diabetes, cardiovascular disease, dental decay and other chronic diseases.

“Leadership has been shown in the Pacific that other countries can learn from. Tonga, for example, has introduced a series of health promoting excise taxes on sugary drinks, fruit juice and sachet drinks,” she said. 

“The taxes have been effective, with imports of sugary drinks decreasing after each tax increase, along with increased production of bottled water.

 “After sugary drinks taxes in Tonga there was also less expenditure on soft drinks. 

“This decline was greater in low income households, suggesting a potential greater health benefit for this lower income group.”

In Samoa the study made reference to the “regular adjustments to the volumetric rate”, which it said has maintained the value of the (sugar-sweetened beverage tax) S.S.B. tax since 2000 as a proportion of import price.

The study also attributed the “widespread use of S.S.B. taxes” in the region to the cost-effectiveness of the policy for obesity prevention.

“Greater political support is possible with the joint benefits of revenue collection and health improvement, and this is likely to be particularly pertinent in resource-poor regions such as in the Pacific where governments often have difficulties with raising revenue and there is a high burden of NCDs,” stated the study.

However, the study also noted that in most of the Pacific states that were studied, the researchers came across what appeared to be “lower tax rates for locally produced beverages than imported beverages”, which could see sugary-drinks consumers opt for local alternatives.  

“The majority of jurisdictions, however, had lower tax rates for locally produced beverages than imported beverages, which increases the risk of substitution to these typically cheaper locally produced beverages. 

“Such policies may also not be consistent with some trade commitments.”

The study also noted declines in the levels of sugary drinks taxes in the region which Dr Teng said was a concern and appeared to be related to inflation and trade liberalisation.

“Many sugary drink taxes in the Pacific could be strengthened by equally taxing local and imported sugary drinks, targeting all types of sugary drinks, adjusting the level of tax for inflation and investing tax revenue in health and obesity prevention,” said Dr Teng.

Other researchers who contributed to the study include: Wendy Snowdon (Centre for Obesity Prevention, Deakin University, Victoria); Si Thu Win Tin (Pacific Community, Fiji); Murat Genç (Otago Business School, University of Otago, New Zealand); Elisiva Na’ati (Pacific Community, Fiji); Viliami Puloka (Department of Public Health, University of Otago Wellington, New Zealand); Louise Signal (Department of Public Health, University of Otago Wellington, New Zealand); and Nick Wilson (Department of Public Health, University of Otago Wellington, New Zealand).

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