Taxing High Fat Sugar Salt (HFSS) Foods as a public health imperative

Source: The post taxing High Fat Sugar Salt (HFSS) foods has been created on the article “Tax ‘HFSS’ foods, view it as a public health imperative” published in “The Hindu” on 20th December 2023.

UPSC Syllabus Topic: GS paper2- governance- Issues relating to development and management of Social Sector/Services relating to Health,

News: The article discusses how eating too much HFSS food is causing health problems like obesity and diabetes worldwide. It focuses on India, where these unhealthy eating habits are growing fast, and suggests that higher taxes on such foods could help reduce their consumption.

What is HFSS food?

According to Ministry of Women and Child Development, HFSS foods may be defined as foods (any food or drink, packaged or non- packaged) which contain low amounts of proteins, vitamins, phytochemicals, minerals and dietary fiber but are rich in fat (saturated fatty acids), salt and sugar and high in energy (calories) that are known to have negative impact on health if consumed regularly or in high amounts.

What is the need to tax HFSS foods?

Health Risks: HFSS foods contribute to obesity, diabetes, and high blood pressure. In India, NCDs due to poor diet have increased from 38% to 65% since 1990, causing 1.2 million deaths annually.

Economic Burden: Obesity’s cost in India was $23 billion in 2017, potentially rising to $480 billion by 2060. This highlights the economic impact of unhealthy diets.

Growing Consumption in India: India, the world’s largest sugar consumer, has seen snack and soft drink sales triple, exceeding $30 billion. This indicates a worrying rise in HFSS food consumption.

What initiatives have been taken to tax HFSS foods?

Global Initiatives

Over 60 countries have implemented taxes on sugary drinks, while 16 countries tax other HFSS foods.

Countries like Denmark, France, Hungary, Mexico, South Africa, the UK, and the US have specific HFSS food taxes.

Colombia recently introduced a law to tax ultra-processed foods.

Indian Initiatives

Kerala’s Fat Tax: In 2016, Kerala introduced a ‘fat tax’, which later merged into India’s Goods and Services Tax in 2017.

GST and Nutritional Content: In India, the current GST system taxes ultra-processed foods such as salty snacks and sugar-sweetened beverages (SSBs) uniformly. For example, all aerated beverages are subject to the same tax rate, regardless of their sugar content, failing to differentiate based on their health impacts.

What should be done?

The WHO and the Indian Council for Research on International Economic Relations (ICRIER) Recommendations for:  a) It urges the FSSAI to clearly define High Fat Sugar Salt foods, ensuring transparency, b) It recommends a nutrient-based tax model, levying higher taxes on products high in fat, sugar, and salt, and lower taxes on healthier alternatives.

HFSS taxation should aim to improve public health, not just generate income. It should encourage industry to create healthier products and motivate consumers to choose better diets.

Ensure that HFSS taxes are non-regressive and do not disproportionately affect lower-income groups. For example, South Africa’s Health Promotion Levy led to greater reductions in sugary drink purchases among lower-income households.

Question for practice:

Discuss the rising consumption of HFSS foods in India, its implications for public health and the economy, and the potential benefits of implementing higher taxes on such foods.