Why your soft drink should cost more

Sugar-sweetened beverages (SSBs) are being subject to increased taxation in various parts of the world, aimed primarily at reducing their consumption in order to curb the rise in lifestyle diseases they cause. Added sugar and high fructose in corn syrup used in sugary beverages are "empty calories" which cause weight gain. They are easily absorbed and lead to obesity which in turn predisposes people for diabetes and other lifestyle diseases. Taxing sugary drinks to wean people off these sugary drinks is thus a welcome idea.

In a recent study published in Journal of American College of Cardiology, it was found that having one-two servings of SSBs daily could increase your risk of heart attack by 35 per cent, diabetes by 26 per cent and that of stroke by 16 per cent. India is the third-most obese country in the world and accounts for a majority of heart attacks related to it. In a recent study involving 17,000 school children it was shown that a whopping 66.11 per cent children have abnormal sugar levels.

At the heart of sugary drinks are soft drinks, which encompasses a wide range of sugary beverages. Indian soft drink market is a whopping Rs 65,000 crore market. It is growing at six per cent and is slated to see 28-30 per cent growth in the next 30 years. India has a per capita consumption rate of three litres while it is 16 for Pakistan and about 80l for the US. It only reflects the huge market potential which beverage giants intend to capture.

One bottle of Coca-Cola in India, as stated in its label, contains 33gm of sugar and 33gm of carbohydrate. It is amusing that the composition of a very broad term "carbohydrate" is not delineated. A study has shown that two bottles of cola per week can cause 1.3kg weigh gain in a child. The famous Framingham Heart Study found that men and women having one or more soft drink per day are 25 per cent more likely to not manage their blood sugar well and a 50 per cent chance to develop metabolic syndrome.

Lifestyle disorders are a huge burden on India's fragile healthcare system. Ramachandran et al, in a study in 2012 showed that the cost of diabetes in India stands at a humongous Rs 1,80,000 million. While an urban diabetic spends Rs 10,000 on care, her rural counterpart spends Rs 6,260. Alarmingly, rural diabetes increased three-fold in just 14 years. Taxing SSBs which would see a cut in consumption, would result in both saving and health benefit for low income households who have low access to healthcare.

With limited healthcare resources, especially in India, taxation of sugary drinks should not be seen as a drive by a "nanny state" but that of pragmatic public health measure. Healthcare is an entitlement and guaranteeing it, especially the component of it that is public good, is a function of the state. In that view, the taxation of SSBs is not aimed at redistribution but at facilitating the entitlement.

Mexico, which has taxed sugary beverages heavily, has seen a six per cent fall in its consumption as a result. In the same time the consumption of bottled water rose by 5.2 per cent proving that healthy alternative can be pushed for by such taxation. There is further evidence which show that soft drink and milk consumption has an inverse relationship. This phenomenon is warranted and is a departure from the classic example of alcohol, heavy taxation or banning of which encourages spurious alternatives.

In a study published last year in PLoS, one of its kinds for India which enrolled over one lakh study subjects, it was proposed that a 20 per cent increase in soda tax could decrease obesity by three per cent and lower 1.6 per cent the number of diabetics. These are promising figures. The taxation however, should not be blanket and should depend on degree of sugariness. To promote better alternative, calorie-free sweeteners should be subsidised.

Taxation is not the sole panacea in dealing with the growing burden of lifestyle disorders. Education and awareness are important cogs in the wheel of healthy lifestyle. Traffic light labelling and teaspoon labelling should be done for sugar, salt and fat content in beverages. We have before us the example of smoking, which as a result of both increased taxation and awareness drives, has seen a decline for the first time in the US.

The Harvard School of Public Health has pegged the economic burden on India due to lifestyle diseases at $6.2 trillion for the period 2012-13. India's patchy healthcare system thus needs policy interventions to curb the rising menace. While taxation for redistribution is unwarranted, taxation as a measure for changing public behaviour, and in this case one that aims at better public health, in a country which cannot take the burden of increasing lifestyle disorders, is desirable.