A 10% tax increase on sugary beverages in Mexico may be positively impacting buying behavior, according to a new study.
In January 2014, Mexico implemented an excise tax of 1 peso per liter for sugar-sweetened beverages as a way to cut down on the country’s growing obesity epidemic. Similar strategies have been debated in the U.S. as well, and Berkeley, California added a tax to sugar-sweetened beverages in March 2015. Still, there’s little research on the effects of taxes for beverages, like soda, over time. Now, a new report published in the journal The BMJ reports that one year after implementation, sales of sugar-sweetened beverages have dropped in Mexico, which could be early evidence of a positive impact.
The researchers reported an average 6% decline in purchases of sugar-sweetened beverages and a 4% average increase in untaxed beverages over 2014, compared to what would have been expected if the tax was not in place. The decline in sugary drink purchases grew over time, reaching a 12% drop in December 2014.
To reach these numbers, the study authors looked at data on beverage purchases in Mexico from January 2012 to December 2014 (before and after the tax was put into place). During 2014, they reported that the average person bought around four fewer liters of taxed beverages. Overall, the decline in purchasing was most significant among low socioeconomic households.
The study authors say it’s too early to determine for certain whether the tax is really working. The study is observational and cannot prove causality, and other factors, like health campaigns about sugary beverages and economic changes, were also happening simultaneously.
In a corresponding editorial, Franco Sassi, a senior health economist at the Organisation for Economic Co-operation and Development in Paris, writes that “taxes can be part of a public health strategy—and Mexico’s is a great example for other countries—but they cannot be viewed as a magic bullet in the fight against obesity.” He adds that more research is needed to understand how taxes can play a role, and that complementary policies like health education are also needed for a comprehensive anti-obesity initiative.
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