Taxes

A liberal solution to Britain’s obesity crisis

Once an ardent opponent of sin taxes, Boris Johnson has now experienced a mighty change of heart. We don’t yet know what his new strategy will look like but one thing is clear: more nannying won’t solve Britain’s obesity problem.

In April 2018, as part of the government’s childhood obesity strategy, the UK government introduced a sugar tax to reduce sugar consumption. A year later, it was announced that plain packaging of crisps, sweets and fizzy drinks was also on the agenda.

In light of the coronavirus pandemic and excessive weight having been recognised as a risk factor, the discussion around obesity and ways to tackle it has been spurred into motion again. The lockdown made things even worse. Almost half of Brits – 47 per cent – have put on weight since lockdown began in March.

The UK government has been using various types of interventions to solve the rising national rates of obesity, and more of those are seemingly on the way. However, a substantial societal shift can only be achieved through a partnership between government and other actors such as business, civil society organisations and advocacy groups and education systems.

Challenging times require innovative solutions. In order to drive down obesity, we have to review our incentives. Longevity and a healthy lifestyle is an excellent motivation in itself but monetary incentives might turn out to be more successful.

Obesity is a societal issue, so fighting it requires a multi-faceted approach. Nowadays, companies go out of their way to improve the wellbeing of their employees by providing gyms, yoga classes, company-wide fitness programs and so on.

Many American firms are now incentivising their employees to become healthier in order to reduce overall insurance costs for those in pooled insurance programs. In the UK, if companies were given tax relief when its provisions allow obesity rates among its employees to decrease, it is likely they would take up the burden to solve this social and public health issue themselves.

The results could be astounding provided that transparency is guaranteed. In a similar fashion, the government could cooperate with the IT sector to create an app where citizens could track their lifestyle, earn rewards for eating healthy food and exercising more in the form of income tax reduction upon reaching specific milestones.

One example of such an idea is the Sweatcoin app which converts steps into a currency that can be spent on various goods and services. The UK could succeed in solving one of the world’s most pressing issues if it decides to embrace innovation.

Lastly, we should also focus on educating students about sugar consumption, and generally about health to ensure they are able to make informed and responsible consumer decisions.

Daily calorie intake in the UK is also decreasing with each decade. It is exercise that many people are lacking, and we should educate consumers about this fact. In particular, education should draw the attention of consumers to sugar so that consumers don’t make these consumption choices by inertia but take time to balance out the present and future costs and benefits.

Coronavirus has spurred a great deal of fear, especially around our health and wellbeing. It is, however, key to remember that that government interventionism is expensive, short-sighted and ignores the complexity of the consumer decision-making process. Education and innovation are a smarter way forward.

Originally published here.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Fairness formula: free markets, rule of law, and consumer choice

In light of the Black Lives Matter protests, a statue of former UK Prime Minister Robert Peel, who, among other things, abolished the disastrous Corn Laws in 1846, has been defaced with socialist graffiti. As someone coming from a post-communist country who came to recognise and appreciate the role of free markets in bringing about prosperity, I was heartbroken. 

Communism, or socialism as its lower and more feasible version, has come to personify the Garden of Eden, the idealist dream of liberté, égalité, fraternité. In modern European history, socialism, as we know it today, started off as an outraged response to the ever-growing wealth gap between the rich and the poor. The complete lack of economic freedom in the form of excessive taxation and irresponsible public expenditure was at the heart of the French revolution. The same story then played out in Russia and resulted in the establishment of the USSR. The social order leading up to these and many similar uprisings was extremely unfair, but the cure was free markets, rule of law, and peace, not socialism, cronyism, and tyranny. 

This lesson of history is especially important and is usually overlooked. Free markets, and in particular free trade, have been key to reducing poverty all across the world. The right to choose that comes with economic freedom has led to individual empowerment in various other areas of life. While socialists’ promise of fairness and equality results in one type of consumer goods available on the shelves, long queues, one haircut for all, one school uniform, and extremely low level of innovation, capitalism celebrates the plentifulness of choices, individuality, and entrepreneurship. And yet free markets are increasingly blamed for all the evils in the world: wealth gap, gender inequality, and even climate change. 

It would be a mistake to claim that free markets are a perfect solution to all problems in the world, but it’s the best we have. If left unchecked and without proper incentives, capitalism can really become a brutal race in which those who obtained the most wealth – sometimes not by legal means – win. However, combined with institutional integrity, and the rule of law, free-market capitalism isn’t only the fairest solution based on merit and choice, it’s also the most desirable one. 

Let’s imagine, as in the famous Rawls’s experiment, that we know nothing about our individual identity meaning that we don’t know what gender we have, whether we are straight or gay, what is our skin colour, and whether we are rich or poor. For the experiment to work, we have to imagine that all of the people are in this position and we have to establish a new social contract. What would we want it to be?

Regardless of who we turn out to be, we would all end up as consumers and would want to enjoy the freedom to choose from the widest array of products. We would prefer them cheap – so taxes have to be low – and would like to get all the information we can about those products, and of course more innovation. When considering our position in the world under the veil of ignorance, we would likely also think about our lifestyle. Would we all want to agree to the state of things when we are told what to consume, or when someone intervenes into our voluntary exchange with other people? Likely not, unless we think about it from the standpoint of a government bureaucrat who might be driven by noble motives but still wants to control our lives. The majority of people standing behind the veil of ignorance wouldn’t buy into that anyway. 

In this experiment, I’m focusing on us as consumers because that is one of the key things that socialism in its pursuit of justice gets wrong. If we look at the world through the veil of ignorance, we would like to be able to make decisions for ourselves, we would want to coordinate in the markets between each other through price mechanisms, not have everything centrally planned. Government is an artificial creation with the mission to deliver on the social contract, and therefore protect our rights, in particular the right to live and property rights. What actually happens, though, is that governments often take our desirable social contract from us by force in favour of fewer markets, less economic freedom, and less consumer choice.

Fairness doesn’t mean equality of outcome, it is the equality of opportunity or the freedom to choose. Only free markets combined with the rule of law can safeguard these.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

A soda tax is a bad idea, and we can prove it

Opinion: A sugary drink tax shouldn’t be dismissed just because it fails to achieve its goals. It is also heavily regressive.

Liberal MP Julie Dabrusin is calling for a national 20-per-cent tax on sugar-sweetened beverages.Jeff Chiu/AP

By David Clement

Canada has an obesity problem, both for adults, and for children. When you look at the numbers, they immediately jump off the page. Since 1978, the obesity rate for Canadians has more than doubled. In 1978, the number of adults who were considered obese was 14 per cent. In 2014, that figure was 28 per cent. General forecasts on this trend state that the number of adults who are obese could rise to 34 per cent by 2025. Rates of obesity this high create a myriad of negative health outcomes, and cost the health-care system billions of dollars annually.

There have been a variety of policies proposed to help curb obesity. Most recently was the call for a national soft drink tax by Liberal MP Julie Dabrusin. Specifically, Dabrusin is calling for a 20-per-cent tax on sugar-sweetened beverages. The thought process here is simple: if you excessively tax a product, it will end up discouraging the purchase of that product, which will lead to better health outcomes and lower expenditures on obesity-related illnesses. The problem with this new tax proposal is that these sin taxes almost always fail to achieve their desired outcome, and have the negative externality of being heavily regressive against the poor.

Sin taxes almost always fail to achieve their desired outcome 

Dabrusin’s goal of healthier outcomes is a noble one, but excessively taxing sugary drinks isn’t a serious solution. We know from other jurisdictions that additional taxes on sugary drinks rarely achieve their goal of reducing caloric intake in any meaningful way. For example, Mexico, a country with an obesity rate near 70 per cent, enacted a sugary drink tax with the goal of reducing caloric intake, thus producing better health outcomes. An analysis of the impact of the tax showed that it reduced consumption of these drinks by only 3.8 per cent, which represents less than seven calories per day. A reduction of this size can hardly be considered a success.

Domestically, we have seen several proposals for sugary drink taxes. In the past provincial election in New Brunswick, Green Party Leader David Coon proposed that the province enact a sugary drink tax of 20 cents per litre. The proposed tax would have added taxes on all pop, most juices, all carbonated water, all non-carbonated flavoured water, most teas, drinkable yogurts and flavoured milk. The major issue with this provincial version of what Dabrusin is proposing is that the designers of the tax scheme openly admitted that it was unlikely to make any significant impact on caloric intake. According to the Green Party’s own submission, the 20-per-cent tax was at best going to reduce overall sugary drink intake by two per cent a year.

In the past provincial election in New Brunswick, the Green Party proposed a sugary drink tax of 20 cents per litre. Getty Images/iStockphoto

At the most, the New Brunswick tax would reduce caloric intake for the average resident by a measly 2.5 calories per day. This estimate was created by using full-calorie soft drinks as a reference point, meaning that the total caloric reduction could actually be much less than 2.5 calories per day given that consumers often consume other sugar-sweetened beverages with fewer total calories than full-calorie soft drinks. It is safe to say that reducing caloric intake by, at most, 2.5 calories per day would have no significant impact on public health. We don’t yet have Dabrusin’s projections on caloric-intake reductions, but from what we can see at the provincial level, the impact wouldn’t be significant in any way.

A sugary drink tax shouldn’t just be dismissed because it fails to achieve its goals. It should also be dismissed because it is heavily regressive. Mexico, again as an example, shows that taxes like the one proposed have a devastating impact on low-income families. The majority of the tax revenue generated from the Mexican tax came from low-income families. Specifically, 61.3 per cent of the revenue generated came from households with low socioeconomic status. Thus, the funds raised were derived from the most vulnerable in society. Supporters of Dabrusin’s proposed tax have cited that the revenue generated would be around $1.2 billion per year. If the Mexican regressive trend holds true for Canada, which can be assumed because it was apparent in cities like Philadelphia, then $732 million of that $1.2 billion will come directly from low-income Canadians. This is an uncomfortable fact that supporters of the tax have yet to sufficiently address.

$732 million of that $1.2 billion will come directly from low-income Canadians 

Soft-drink taxes are simply bad policies being used to combat a real problem. These taxes almost always miss their mark, and disproportionately impact low-income consumers. These truths are part of the reason Cook County, Ill. (which includes Chicago) repealed its soft-drink tax. Because of these fairly consistent trends, the New Zealand Institute of Economic Research, in a report to the Ministry of Health, stated that “We have yet to see any clear evidence that imposing a sugar tax would meet a comprehensive cost-benefit test.” It’s clear that obesity is a problem in Canada, but it is also clear that soft-drink taxes don’t pass the cost-benefit test, and shouldn’t be considered as a serious solution.

— David Clement is the North American Affairs Manager for the Consumer Choice Center.

Read more here

Democratising travel

The #HandsOffMyCheapFlights campaign is about more than just what its name suggests. Cheap flights are what consumers know and love about air travel in the past years, but it is the overall phenomenon of democratised travel that should have us stand in awe. For people in upper-middle-class and wealthy conditions, the world was just the purchase of a ticket away for much longer. Whether it’s €300 or €30 to Milan, doesn’t really make much of a difference to them. So to the privileged (you’ll excuse the word) eye, travelling has remained the same, with one notable change: there are more people on the airport. Shockingly, it’s low-income consumers who suddenly fly into the same airport as the privileged travellers. It takes more time to get your suitcase, getting through security is a hassle, and for goodness sake, you can’t even get a seat while waiting to board.

No wonder some people are a bit annoyed. But saying that you don’t want people to fly just so that you don’t have to pay for fast-track security control isn’t marketable, so sustainability comes into play. What about all the noise and pollution? Don’t bother considering the fact that innovation in the aviation sector is continuously improving fuel efficiency, since carriers have no incentive to waste kerosene needlessly. Also, don’t mention that improved aircrafts, more efficient flight routes, and reduced speeds have made the sector much more efficient than it was 20 or 30 years ago.

That’s all a bit hyperbolic, and you’ll maybe even consider it bad faith. And maybe it is.

But for some reason, not everyone rejoices at the democratisation of travel. In a time in which the debate about inequality is so predominant, we’re not lending an ear to consumers who want to go on holidays, or visit a friend, just as much as all those with higher income than them. Modern aviation has made it possible, yet activists and governments around the world are there to roll this back.

The Consumer Choice Center fights the EU departure tax from the beginning. We will stand up for consumers who want to have choices when it comes to the means of transportation. We are making people aware that flights are emitting much less carbon than they were in the past, and that this level innovation is set to continue in the future. If however, we choose to limit this development in an effort to answer to alarmism, then we will inevitably fail.

Let’s not let that happen.

Cuomo’s Out of Control Craving for an Opioid Slush Fund

Sometimes a bad idea is a bad idea, no matter how you package it. New York Governor Andrew Cuomo is trying again, after his $600 million opioid tax was slapped down in December by an Obama appointed federal judge. Proponents of the earlier tax scheme pointed to a key provision which forbade manufacturers from passing along […]

Dutch Plans of an EU-wide Air Passenger Tax won’t fly High with Consumers

Last month, the Dutch government began circulating a position paper suggesting the EU should introduce a Union-wide air passenger departure tax on flights departing from the European Union. The paper promoted by the Netherland’s Secretary of State for Finance Menno Snel suggests a 7 EUR per passenger flight tax be rolled out within all Member […]

Taxing Sugar and Salt Hurts the People it Aims to Help

By Thomas Walker Following the introduction by the British government of a tax on sugary carbonated drinks in April 2018, intended to improve public health and combat obesity in children, some campaigners have started calling for similar taxes on a wider range of products. NHS Chief Medical Officer Prof. Dame Sally Davies, described by the […]

Sin taxes are taxes on the poor

Nanny-state types know this. They just don’t care. In Britain, Europe and across the world, taxes on tobacco, alcohol and sugar are used by governments to try to push people into what they deem to be healthier lifestyles. Indeed, nanny-state policies are infesting Europe through its political institutions. In a recent memo, the European Commission set out plans […]

The fallacy of the meat tax

Bill Wirtz examines the shortcomings of the proposed tax on red meat. In a recent publication for the University of Oxford, Dr. Marco Springmann and James Martin, both Fellows at the Oxford Martin School argue for the introduction of additional taxes on red meat. Springmann makes the case that taxing products such as bacon could save thousands […]

Life as a taxpayer: paying to be berated

The EU’s 2018 NGO Health Awards took place this week where the European Commission recognised those NGOs it deems to be the most effective in fighting the use of tobacco. Bill Wirtz watched what he describes as “an insufferable nanny state love-in”, so you don’t have to.  At the beginning of the EU Health Policy Platform annual […]

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