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Fiscal Policies

Woman in pink polo shirt leans over grocery cart containing vegetables and several bottled beverages and reviews a long receipt.

Fiscal policies such as taxes on sugary drinks or junk foods work to reduce purchases and intake of unhealthy products and to increase purchases and intake of healthier alternatives. Over 50 countries and smaller jurisdictions have instituted taxes like these aimed at improving public health and reducing the burden of chronic diseases including obesity.

Barbados

Read more about our work in Barbados

Excise Tax on Sweetened Beverages | Passed August 1, 2015 | Amended April 1, 2022

20% excise tax on sweetened beverages

From August 1, 2015 – April 1, 2022, sweetened beverages were subject to a 10% ad valorem excise tax.

Announced March 14, 2022 and effective April 1, 2022, the rate of excise tax on sweetened beverages increased from 10% to 20%. The tax rate increase advances the Government of Barbados’s mandate to reduce sugar consumption through effective fiscal policy on sweetened beverages and brings the tax rate in line with recommendations of the World Health Organization.

The tax is levied on locally produced and imported beverages including carbonated soft drinks, juice drinks, sports drinks, liquid concentrates, and more. Drinks exempt from the tax include 100% juices, coconut water, plain and evaporated milk, powdered concentrates, and drinks sweetened with non-caloric sweeteners.

Table of applicable tariffs from the Barbados Revenue Authority

Chile

Read more about our work in Chile

Ley 20.780 | Implemented October 1, 2014

Beverage tax law

For all non-alcoholic drinks with with coloring, flavoring, or caloric sweeteners:

  • 18% ad valorem tax on drinks containing >6.25 g sugar/100 mL (5% increase from previous rate of 13%)
  • 10% ad valorem tax on drinks with ≤6.25 g sugar/100 mL (3% decrease from previous rate of 13%)

Exempt: 100% fruit juice and dairy-based beverages

Read law in: Spanish | English

Colombia

Read more about our work in Colombia

Ley 2277 — Impuesto Saludable a Bebidas y Alimentos Ultra-Procesados (Reforma Tributaria) | Passed December 13, 2022

Colombia's ultra-processed product taxes

Tax on ultra-processed, sugary drinks

Beginning November 1, 2023, Colombia will tax all ultra-processed sugary drinks, including carbonated and non-carbonated beverages, malt-based beverages, teas, coffee-type beverages, fruit drinks and nectars, fruit concentrates, energy drinks, sports drinks, flavored waters, and powder mixes. The following beverages are exempt: plain water, 100% fruit or vegetable juices, and infant formula. The tax rate will depend on beverages' added sugar content and will increase yearly in three phases (with more strict sugar thresholds in 2025), and will be updated for inflation automatically, starting in 2026.

Table showing Colombia tax rates. Link in caption to html version.
Percentages are calculated on a base price at 2022 values. View table as html.

Tax on ultra-processed food products

Beginning November 1, 2023, Colombia will tax ultra-processed foods, defined as edible products formulated from food-derived substances along with additives, that contain added sugars, sodium, and saturated fats and exceed the following thresholds for those nutrients:

  • >1 mg of sodium per 1 kcal and/or >300 mg of sodium per 100 g
  • >10% of total energy from free sugars
  • >10% of total energy form saturated fats

The tax rates will be 10% in 2023, 15% in 2024 and 20% in 2025.

Ultra-processed food categories subject to taxation will include: milk products added with sugar, sausages and cold cut meats, chocolates and confectionary candies, snacks, bakery products, breakfast cereals, canned fruits and vegetables added with fat, sugar or salt, jams, jellies and marmalades, sauces, condiments, and seasonings. Exempt categories are Colombian traditional foods such as arequipe or dulce de leche (milk caramel), salchichon (sausage), oblea (thin round wafer), bocadillo (guava paste).

Read law in Spanish | English (translation of Title V: Health Taxes).

Mexican flag

Mexico

Read more about our work in Mexico

Ley del Impuesto Especial sobre Producción y Servicios | Implemented January 1, 2014

Excise Tax Law for Production and Services

  • Sugary drinks: 1 peso per liter excise tax on any non-alcoholic beverage with added sugar, including concentrates (powders or syrups, taxed based on reconstituted volume); exempts milk beverages, 100% juices
  • Non-essential foods: 8% sales tax on foods containing >275 calories/100 grams in these categories:
    • Snacks
    • Confectionery products.
    • Chocolate and other cocoa products.
    • Custards and puddings
    • Fruit and vegetable sweets
    • Peanut and hazelnut creams
    • Dulces de leche
    • Prepared cereal foods
    • Ice cream, snow and ice popsicles

Read law in: English or Spanish; read tax law resolution (definition of basic foods exempt of tax) in Spanish (See I.5.1.3.)

Peruvian flag

Peru

Read more about our work in Peru

Supreme Decree 091-2018-EF | Implemented May 1, 2018

Supreme Decree 091-2018-EF

Prior to May 2018, Peru taxed all beverages with added sugar, sweeteners, or flavorings at a rate of 17%. In May 2018, the tax was increased to 25% for drinks with >6 grams total sugar per 100mL, while all other drinks with added sugar/sweeteners/flavorings (containing <6 g sugar/100 mL) remained at the 17% tax rate.

In June 2019, Peru modified the tax again by decreasing the rate on drinks with <0.5 g sugar/100 mL (e.g., diet sodas) to 12%, while drinks containing 0.5–6 g/100 mL remained at the 17% rate. Plain water, 100% juices, plain milk, and drinkable yogurts were always and remain untaxed.

In sum, from June 2019 onward, processed beverages with added sugar, sweeteners, or flavoring are taxed at one of three levels:

  • 25% ad valorem tax on drinks containing >6 g sugar/100 mL (increase from 17% rate)
  • 17% ad valorem tax on drinks containing 0.5–6 g sugar/100 mL
  • 12% ad valorem tax on drinks containing <0.5 g sugar/100 mL (decrease from 17%)

Exempt: Plain water, 100% juice, plain milk, and drinkable yogurts

Read law in: English, 2018 | English, 2019

South African flag

South Africa

Read more about our work in South Africa

Rates and Monetary Amounts and Amendment of Revenue Laws Act 2017, Act No. 14 | Implemented April 1, 2018

Health Promotion Levy

For all non-alcoholic beverages and beverage concentrates, manufacturers & distributors taxed:

  • R0.021 ($0.0014 USD) per gram sugar in excess of 4 g/100 mL.
  • If sugar is not labeled, product taxed at default rate based on containing 20 g sugar/100mL (R0.336/100 mL or $0.023 USD).

Exempt: 100% juice, dairy beverages

Resources

A prescription for healthier diets: SuperSNAP in NC

Policy brief describing SuperSNAP, a Food is Medicine program in NC. Starting in September 2019, the SuperSNAP program enrolled individuals with diet-related health conditions receiving Supplemental Nutrition Assistance Program (SNAP) benefits in nine federally qualified health centers across North Carolina. SuperSNAP participants received $40 per month to spend on fresh, frozen, canned, or dried fruits and vegetables without additives at a participating NC-based chain retailer with around 500 stores across North Carolina. This policy brief includes reflections from surveys with consumers, NC retailers, and healthcare providers on the success of the SuperSNAP program.

Taxes on unhealthy foods and beverages

Global maps showing countries and smaller jurisdictions with taxes on sugary or sweetened beverages and/or unhealthy foods, that were implemented with a goal of curbing sugar, salt, saturated or trans fat, and excessive calorie consumption and improving public health. Included are brief descriptions of each tax structure and dates of passage or implementation.

Taxing sugary drinks: A fiscal policy to improve public health

Learn about the connections between excess sugar consumption and prevalence of obesity and other noncommunicable diseases, as well as real-world evidence for how sugary drink taxes can reduce sugar intake, improve health, and increase government revenue while decreasing health care costs and the personal and shared burdens of nutrition-related diseases.

Ultra-processed foods

Fact sheet describing ultra-processed foods and drinks and the threat they pose to public health worldwide as they make up increasingly greater portions of the global diet. Learn how to identify ultra-processed products; review the evidence for their association with a multitude of risk factors, diseases, and mortality; and explore policy options to reduce consumption. […]

Publications

Cost-benefit analysis of alternative tax policies on sugar-sweetened beverages in Mexico.
Authors: Juan Carlos Salgado Hernandez, Shu Wen Ng, Sally C. Stearns, Justin G. Trogdon.
Published in: PLOS One. October 3, 2023 view full text

Changes in sugar-sweetened beverage purchases across the price distribution after the implementation of a tax in Mexico: a before-and-after analysis
Authors: Juan Carlos Salgado Hernández, Shu Wen Ng, M. Arantxa Colchero
Published in: BMC Public Health, February 7, 2023 view full text

Employment and wage effects of sugar-sweetened beverage taxes and front-of-package warning label regulations on the food and beverage industry: Evidence from Peru
Authors: Juan-José Díaz, Alan Sánchez, Francisco Diez-Canseco, J. Jaime Miranda, Barry
M. Popkin
Published in: Food Policy, January 20, 2023 view full text

Are intentions to change, policy awareness, or health knowledge related to changes in dietary intake following a sugar-sweetened beverage tax in South Africa? A before-and-after study
Authors: Michael Essman, Catherine Zimmer, Francesca Dillman Carpentier, Elizabeth C. Swart, Lindsey Smith Taillie
Published in: International Journal of Behavioral Nutrition and Physical Activity, October 28, 2022 view full text

Simulation models of sugary drink policies: A scoping review
Authors: Natalie Riva Smith, Anna H. Grummon, Shu Wen Ng, Sarah Towner Wright, Leah Frerichs
Published in: PLOS ONE, October 3, 2022 view full text

Decomposing consumer and producer effects on sugar from beverage purchases after a sugar-based tax on beverages in South Africa
Authors: Maxime Bercholz, Shu Wen Ng, Nicholas Stacey, Elizabeth C. Swart
Published in: Economics & Human Biology, March 21, 2022 view full text

Purchases of non-taxed foods, beverages, and alcohol in a longitudinal cohort after implementation of the Philadelphia Beverage Tax
Authors: Anna H. Grummon, Christina A. Roberto, Hannah G. Lawman, Sara N. Bleich, Jiali Yan, Nandita Mitra, Sophia V. Hua, Caitlin M. Lowery, Ana Peterhans, Laura A. Gibson
Published in: The Journal of Nutrition, December 15, 2021 view full text

The impacts on food purchases and tax revenues of a tax based on Chile’s nutrient profiling model
Authors: M. Arantxa Colchero, Guillermo Paraje, Barry M. Popkin
Published in: PLOS ONE, December 2, 2021 view full text

How should we evaluate sweetened beverage tax policies? A review of worldwide experience
Authors: Shu Wen Ng, M. Arantxa Colchero, Martin White
Published in: BMC Public Health, October 26, 2021 view full text

Cash transfer programs are important for improved nutrition in low- and middle-income countries
Authors: Barry M. Popkin
Published in: The Journal of Nutrition, October 12, 2021 view full text

South Africa's health promotion levy: Excise tax findings and equity potential
Authors: Karen Hofman, Nicholas Stacey, Elizabeth Swart, Barry Popkin, Shu Wen Ng
Published in: Obesity Reviews, May 31, 2021 view full text

Changes in beverage purchases following the announcement and implementation of South Africa's Health Promotion Levy: An observational study
Authors: Nicholas Stacey, Ijeoma Edoka, Karen Hofman, Elizabeth C. Swart, Barry Popkin, and Shu Wen Ng
Published in: The Lancet Planetary Health, April 1, 2021 view full text

Sugar-sweetened beverage reduction policies: Progress and promise
Authors: James Krieger, Sara Bleich, Stephanie Scarmo, and Shu Wen Ng
Published in: Annual Review of Public Health, April 1, 2021 view full text

Would a national sugar‐sweetened beverage tax in the united states be well targeted?
Authors: Pourya Valizadeh, Shu Wen Ng
Published in: American Journal of Agricultural Economics, February 2, 2021 view full text

Implementation science is important for understanding and advancing beverage taxes
Authors: Sara N. Bleich, Jamie Chriqui, Shu Wen Ng
Published in: Am J Public Health, September 1, 2020 view full text

Association between tax on sugar sweetened beverages and soft drink consumption in adults in Mexico: Open cohort longitudinal analysis of Health Workers Cohort Study
Authors: Luz María Sánchez-Romero, Francisco Canto-Osorio, Romina González-Morales, M Arantxa Colchero, Shu Wen Ng, Paula Ramírez-Palacios, Jorge Salmerón, Tonatiuh Barrientos-Gutiérrez
Published in: BMJ, May 6, 2020 view full text

Body weight impact of the sugar-sweetened beverages tax in Mexican children: A modeling study
Authors: Rossana Torres-Álvarez, Rodrigo Barrán-Zubaran, Francisco Canto-Osorio, Luz M. Sánchez-Romero, Dalia Camacho-García-Formentí, Barry M. Popkin, Juan A. Rivera, Rafael Meza, Tonatiuh Barrientos-Gutiérrez
Published in: Pediatr Obes, April 13 2020 view full text

Combined fiscal policies to promote healthier diets: Effects on purchases and consumer welfare
Authors: Juan C. Caro, Porya Valizadeh, Alejandrina Correa, Andres Silva, Shu Wen Ng
Published in: PLOS One, January 15 2020 view full text

Understanding heterogeneity in price changes and firm responses to a national unhealthy food tax in Mexico
Authors: Juan C. Salgado, Shu Wen Ng
Published in: Food Policy, December 1 2019 view full text

Sugar-based beverage taxes and beverage prices: Evidence from South Africa’s Health Promotion Levy
Authors: Nicholas Stacey, Caroline Mudara, Shu Wen Ng, Corne van Walbeek, Karen Hofmam, Ijeoma Edoka
Published in: Social Science & Medicine, October 1 2019 view full text

Did high sugar-sweetened beverage purchasers respond differently to the excise tax on sugar-sweetened beverages in Mexico?
Authors: Shu Wen Ng, Juan A. Rivera, Barry M. Popkin, Michelle A. Colchero
Published in: Public Health Nutr, March 2019 view full text

Chile’s 2014 sugar-sweetened beverage tax and changes in prices and purchases of sugar-sweetened beverages: An observational study in an urban environment
Authors: Juan C. Caro, Camila Corvalán, Marcela Reyes, Andres Silva, Barry M. Popkin, Lindsey S. Taillie
Published in: PLOS Med, 2018 view full text

Mexican cohort study predates but predicts the type of body composition changes expected from the Mexican sugar-sweetened beverage tax
Author: Barry M. Popkin
Published in: Am J Public Health, November 2017 view full text

In Mexico, evidence of sustained consumer response two years after implementing a sugar-sweetened beverage tax
Authors: Michelle A. Colchero, Barry M. Popkin, Juan A. Rivera, Shu Wen Ng
Published in: Health Affairs, March 2017 view full text

Beverage purchases from stores in Mexico under the excise tax on sugar sweetened beverages: observational study
Authors: M Arantxa Colchero, Barry M. Popkin, Juan A. Rivera, Shu Wen Ng
Published in: BMJ, January 2016 view full text

Changes in prices after an excise tax to sugar sweetened beverages was implemented in Mexico: evidence from urban areas
Authors: Colchero MA, Salgado JC, Unar-Munguía M, Molina M, Ng SW, Rivera-Dommarco JA
Published in: PLoS ONE, December 2015 view full text

Drinking to our health: Can beverage companies cut calories while maintaining profits?
Authors: Susan Kleiman, Shu Wen Ng, Barry M. Popkin
Published in: Obesity Reviews, March 2012 view full text