How to Set up an Effective Food Tax?; Comment on “Food Taxes: A New Holy Grail?”

Document Type: Commentary

Author

Toulouse School of Economics, University of Toulouse 1 Capitole, Toulouse, France

Abstract

Whereas public information campaigns have failed to reverse the rising trend in obesity, economists support food taxes as they suggest they can force individuals to change their eating behavior and make the agro-food industry think more about healthy food products. Excise taxes based on the unhealthy nutrient content would be more effective since they impact more on unhealthy food products than VAT (value-added-tax) taxes. Taxes based only on junk food products would avoid perverse effects on healthy nutrient. However, as eating behavior of consumers is complex, a modeling analysis would allow to assess unexpected effects on other unhealthy nutrients or products.

Keywords

Main Subjects


1. Devisch I. Food taxes: a new holy grail? International Journal of Health Policy and Management 2013; 1: 95–7. doi: 10.15171/ijhpm.2013.15
2. Snyder L. Health communication campaigns and their impact on behavior. J Nutr Educ Behav 2007; 39: S32–40. doi: 10.1016/j.jneb.2006.09.004
3. Weiss JA, Tschirhart M. Public information campaigns as policy instruments. J Policy Anal Manage 1994; 13: 82–119. doi: 10.2307/3325092
4. Nayga RM. Impact of sociodemographic factors on perceived importance of nutrition in food shopping. J Consum Aff 1997; 31: 1–9. Doi: 10.1111/j.1745-6606.1997.tb00823.x
5. Cutler DM. Behavioral Health Interventions: What Works and Why? In: Bulatao RA, Anderson NB, editors. Understanding Racial and Ethnic Differences in Health in Late Life: A Research Agenda. National Research Council (US) Panel on Race, Ethnicity, and Health in Later Life. Washington: National Academies Press; 2004.
6. Harnack L, Stang J, Story M. Soft drink consumption among US children and adolescents: nutritional consequences. J Am Diet Assoc 1999; 99: 436–41. doi: 10.1016/s0002-8223(99)00106-6
7. Marshall T. Exploring a fiscal food policy: the case of diet and ischaemic heart disease. BMJ 2000; 320: 301–5. doi: 10.1136/bmj.320.7230.301
8. Jacobson MF, Brownell KD. Small taxes on soft drinks and snack foods to promote health. Am J Public Health 2000; 90: 854–7. doi: 10.2105/ajph.90.6.854
9. Ransley JK, Donnelly JK, Botham H, Khara TN, Greenwood DC, Cade JE. Use of supermarket receipts to estimate energy and fat content of food purchased by lean and overweight families. Appetite 2003; 41: 141–8. doi: 10.1016/s0195-6663(03)00051-5
10. Bonnet C, Dubois P, Orozco V. Household Food Consumption, Individual Calories Intake and Obesity in France. Empir Econ 2013; Forthcoming. doi: 10.1007/s00181-013-0698-1
11. Cutler DM, Glaeser EL, Shapiro JM. Why have Americans become more obese? J Econ Perspect 2003; 17: 93–118. doi: 10.3386/w9446
12. Cutler DM, Glaeser EL. What Explains Differences in Smoking, Drinking, and Other Health-Related Behaviors? Am Econ Rev 2005; 95: 238–42. doi: 10.3386/w11100
13. Fletcher J, Frisvold D, Tefft. The effects of soft drink taxes on child and adolescent consumption and weight outcomes. J Public Econ 2010; 94: 967–74. doi: 10.1016/j.jpubeco.2010.09.005
14. Chouinard HH, Davis DE, LaFrance JT, Perloff JM. Fat taxes: big money for small change. Forum Health Econ Policy 2007; 10: 1–30. doi: 10.2202/1558-9544.1071
15. Bonnet C, Dubois P, Orozco V. Food Consumption and Obesity in France: Identification of Causal Effects and Price Elasticities. 2009. [cited 2013 August 20]. Available from: http://idei.fr/doc/conf/inra/papers_2008/dubois.pdf
16. Bonnet C, Réquillart V. Does the EU sugar policy reform increase added sugar consumption? An empirical evidence on the soft drink market. Health Econ 2011; 20: 1012–24. doi: 10.1002/hec.1721
17. Bonnet C, Réquillart V. Tax incidence with strategic firms in the soft drink market. J Public Econ 2013; 106: 77–88. doi: 10.1016/j.jpubeco.2013.06.010
18. Allais O, Bertail P, Nichele V. The effects of a fat tax on French households’ purchases: a nutritional approach. Am J Agric Econ 2010; 92: 228–45. doi: 10.1093/ajae/aap004
19. O’Donoghue T, Rabin M. Optimal sin taxes. J Public Econ 2006; 90: 1825–49. doi: 10.1016/j.jpubeco.2006.03.001
20. Cremer H, De Donder P, Maldonado D, Pestieau P. Taxing sin goods and subsidizing health care. Scand J Econ 2012; 114; 101–23. doi: 10.1111/j.1467-9442.2011.01666.x
21. Mytton O, Gray A, Rayner M, Rutter H. Could targeted food taxes improve health? J Epidemiol Community Health 2007; 61: 689–94. doi: 10.1136/jech.2006.047746
22. Smed S, Jensen J, Denver S. Socio economic characteristics and the effect of taxation as a health policy instrument. Food Policy 2007; 32: 624–39. doi: 10.1016/j.foodpol.2007.03.002
23. Delipalla S, Keen M. The comparison between ad valorem and specific taxation under imperfect competition. J Public Econ 1992; 49: 351–67. doi: 10.1016/0047-2727(92)90073-o
24. Anderson SP, de Palma A, Kreider B. Tax incidence in differentiated product oligopoly. J Public Econ 2001; 81: 173–92. doi: 10.1016/S0047-2727(00)00079-7
25. Delipalla S, O’Donnell O. Estimating tax incidence, market power and market conduct: the European cigarette industry. International Journal of Industrial Organization 2001; 19: 885–908. doi: 10.1016/s0167-7187(99)00057-0
26. Bonnet C, Réquillart V. Impact of cost shocks on consumer prices in vertically related markets: the case of the French soft drink market. Am J Agric Econ 2013; Forthcoming. doi: 10.1093/ajae/aat055
27. Campa JM, Goldberg LS. Pass through of exchange rates to consumption prices: What has changed and why? In: Ito T, Rose AK, editors. International Financial Issues in the Pacific Rim: Global Imbalances, Financial Liberalization, and Exchange Rate Policy (NBER-EASE Volume 17). National Bureau of Economic Research and University of Chicago Press; 2006. p. 139–76. doi: 10.7208/chicago/9780226387086.003.0006
28. Nnoaham K, Sacks G, Rayner M, Mytton O, Gray A. Modelling income group differences in the health and economic impacts of targeted food taxes and subsidies. Int J Epidemiol 2001; 38: 1324–33. doi: 10.1093/ije/dyp214