The question as to whether Ireland should impose a tax on so-called junk foods is not a new one - but experts still remain at odds as to what exact form such a levy should take.
A recent study predicting that Ireland could become the most obese country in Europe by 2030 if current trends continue has brought an element of renewed urgency to a debate which had faltered somewhat after the Government chose not to introduce a tax on drinks with added sugar in Budget 2013.
Subsequent records showed then minister for health James O’Reilly was very much in favour of implementing a 20 per cent tax on such products and, according to weight management expert Prof Donal O’Shea, the move remains long overdue.
He says there is unanimity of opinion in medical and nutritional circles that the measure is needed not only to raise money through taxation for greater education around healthy eating, but also to curb Ireland’s excessive annual health spend on conditions such as obesity and diabetes, which cost the exchequer €1.13 billion and is set to rise to €5.4 billion by 2030.
“A recent public survey found that the majority of people now favour the introduction of the tax,” says Prof O’Shea, referring to an Ipsos/MRBI poll on behalf of the Irish Heart Foundation which found 52 per cent of participants wanted a tax on sugary drinks.
Cautionary note
“The fact that people would even be open to a new tax is amazing,” he adds, before sounding the cautionary note that decision-makers will likely “kick the can down the road” until after the next election to avoid possible public backlash as well as sustained attacks from lobbyists in the food and drinks industry.
There may be some level of consensus as regards the imposition of a tax on unhealthy foodstuffs, but issues around how it will work and what it will affect remain a substantial stumbling block.
In his much-discussed 2012 study on the introduction of a fat tax in Ireland, Dr Micheál Collins of the Nevin Economic Research Institute (NERI), alongside Maria Murray of Trinity College, concluded that a tax on saturated fat would raise nearly €80 million each year.
If combined with a tax on added sugar (€95 million) and added salt (€13 million) it could provide a €188 million windfall for government finances.
Main offenders
He says a tax per litre rather than by percentage of cost would have a more substantial effect on the cheapest soft drinks - often seen as the main offenders for childhood consumption in particular - but it would have a negligible impact on the price of premium brands.
In a pre-budget submission earlier this year, the Irish Heart Foundation called for a 20 per cent tax on sugar-sweetened drinks.
It claimed the measure could bring in about €44.5 million a year for the exchequer.
Although the issue sparked some debate in the run-up to Budget 2016, the Government did not introduce such a tax.
Analysing assertions from groups including Ibec that the tax would be unnecessarily regressive and would put thousands of jobs at risk, Dr Collins admits their fears could well come to pass if it is brought in.
“The long-term objective is clearly to see some reduction so, I suppose, while one would not see any notable changes to jobs and employment in the short-term, one would expect over time that there might be.”
Asked whether soft drink companies could be entitled to cry foul if their businesses were disproportionately affected by a tax on just one sector of unhealthy foods, he says any such sense of injustice might well be justified. “There’s merit in it being more comprehensive than just one good, and I’d be concerned with a policy where the focus would just be on one good.”
Chief specialist in public nutrition with the Food Safety Authority of Ireland (FSAI) Dr Mary Flynn is similarly sceptical of any levy with such a narrow focus.
“Sugar-sweetened drinks are a good target because they don’t add anything except extra calories, but there are other foods that I would prefer to target as a nutritionist,” says Dr Flynn, whose organisation is tasked with providing technical advice to the Department of Health.
“I’d prefer to target pastries and maybe biscuits, because not only do they have sugar, but they also have fat, and the type of fat they have directly causes adverse effects in relation to heart disease and possibly cancer.”
Her main concern about increasing the cost of food with unnecessary added fat, sugar and calories is that it would disproportionately affect the least well-off in society.
Instead of diverting revenue from an added sugar tax to broader healthy eating education, she thinks the funding should be used to subsidise healthy food options for Ireland’s poorest households.
“Any kind of a tax on food would disproportionately hit those people more than anyone else. We would be in favour of a tax on food, so long as you can ring-fence the money that comes out of the economy and put it back into giving those families some supplements, some vouchers, some money so they could purchase healthier food.”
Danish disaster
Ireland won’t necessarily be blazing a trail if we go down the route of taxing foods with empty calories. Denmark introduced the world’s first tax on saturated fat in 2011, and it was a disaster.
Huge consequent price inflation on everyday goods such as butter and cheese sent shoppers across nearby borders to Germany and Sweden. The measure was rescinded in 2012, but Dr Flynn does not see a similar situation unfolding in Ireland.
“That’s a possibility. I don’t know if you’d see people driving up North to buy sugar-sweetened drinks.”
NERI’s Micheál Collins believes the most feasible option would have subtle effects on prices - three cent on a chocolate bar, five cent on a two-litre bottle of cola, thereby avoiding the exponential cost increases seen in Denmark.
Whatever about the subject, the conversation around taxing junk food remains vibrant and healthy in Ireland.
If the dire forecasts from respected international bodies such as the World Health Organisation are to be believed, some sort of action is needed at the first possible opportunity to tackle the ongoing explosion in expanding waistlines.