The Effect of Price and Socio-Economic Level on the Consumption of Sugar-Sweetened Beverages (SSB): The Case of Ecuador

Paraje, Guillermo

doi:10.1371/journal.pone.0152260

Cited by 48 publications

(73 citation statements)

References 17 publications

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“…In particular, the proposed tax could lead to a reduction of soft drink consumption by 11.4%. This is in line with previous studies in Mexico by Colchero et al (2015) [11], in Guatemala by Chacon et al (2018) [23], and in Ecuador by Paraje (2016) [24], where the own-price elasticity of SSB are estimated at 1.16, 1.39, and 1.17-1.33, respectively.…”

Section: Discussionsupporting

confidence: 92%

Impacts of Excise Taxation on Non-Alcoholic Beverage Consumption in Vietnam

Luong

2020

Sustainability

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Vietnam is faced with the issue of increasing overweight and obesity, particularly among children and adolescents in urban areas. As a result, the government of Vietnam recently introduced a proposal to impose a special consumption tax on sugar-sweetened beverages (SSB) in Vietnam, as the drinks are causing negative health consequences for Vietnamese people. This research is aimed at evaluating the impacts of a 10% special consumption tax on SSB in Vietnam using the Almost Ideal Demand System (AIDS) model. We found that a 10% SSB tax will reduce SSB consumption by 11.4%. Consumers will switch to substitutes, leading to an increase in the consumption of milk by 2.3%, beer by 2.5%, dried tea by 2.2%, and wine by 1.7%. However, in the short run, the tax could lead to a decrease in consumer welfare due to higher SSB prices. In addition to people from better-off households, people from the ethnic majority group, most of which live in urban areas with a large number of children, have a relatively high welfare reduction.

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Section: Discussionsupporting

confidence: 92%

Impacts of Excise Taxation on Non-Alcoholic Beverage Consumption in Vietnam

Luong

2020

Sustainability

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“…In general, studies show that SSBs are price-elastic, meaning that consumptions drops more than proportionally to price increases. Recent studies for Mexico and Ecuador report price-elasticities of −1.16 and −1.2 respectively (Colchero, Salgado, Unar-Munguía, Hernández-Ávila, & Rivera-Dommarco, 2015; Paraje, 2016). In contrast, evidence on price-elasticity for energy-dense processed foods is less conclusive, mainly because there is a lack of consensus regarding the definition of ‘junk’ food.…”

Section: Discussionmentioning

confidence: 99%

Designing a tax to discourage unhealthy food and beverage purchases: The case of Chile

Carlos

Taillie

et al. 2017

Food Policy

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The global shift towards diets high in sugar-sweetened beverages (SSBs) and energy dense ultra-processed foods is linked to higher prevalence of obesity, diabetes and most other noncommunicable diseases (NCDs), causing significant health costs. Chile has the highest SSB consumption in the world, very high junk food intake and very rapid increases in these poor components of the diet plus obesity prevalence. This study’s purpose is to compare the effect of different tax schemes for SSBs and ultra-processed foods on nutrient availability, utilizing price-elasticities, which are estimated from a Quadratic Almost Ideal Demand System model, using the 2011–2012 Income and Expenditure survey. We take into account the high proportion of households not purchasing various food and beverage groups (censored nature of data). The food groups considered were: sweets and desserts; salty snacks and chips; meat products and fats; fruits, vegetables and seafood; cereals and cereal products; SSB ready-to-drink; SSB from concentrate; plain water, coffee and tea; and milk, which together represent 90% of food expenditures. The simulated taxes were: (1) 40% price tax on SSBs(22% above the current tax level); (2) a 5 cents per gram of sugar tax on products with added sugar; and (3) 30% price tax on all foods(27% above current tax levels) and beverages (12% above the current tax level) exceeding thresholds on sodium, saturated fat, and added sugar and for which marketing is restricted (based on a Chilean law, effective June 16 2016). Unhealthy foods are price-elastic (−1.99 for salty snacks and chips, −1.06 for SSBs ready-to-drink, and −1.27 for SSBs from concentrate), meaning that the change in consumption is proportionally larger with respect to a change in price. Results are robust to different model specification, and consistent among different socioeconomic sub-populations. Overall, the tax on marketing controlled foods and beverages is associated with the largest reduction in household purchases of sodium, added sugar, saturated fat and calorie purchases. Chile is unique in currently having instituted a small current SSB tax as well as marketing controls and front-of-package labeling of unhealthy foods and beverages. The design of a larger, more comprehensive tax to enhance the overall effect of these policies on healthier diets is a next critical step. This study shows that a large tax on the same foods and beverages already delineated as unhealthy by the marketing controls and front-of-pack labeling should prove to be more effective for promoting a healthier diet.

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“…This appears to contradict the findings of several other studies that have investigated the impact of SSB taxes on different income groups. Studies regarding price elasticities have determined lower income households to have a greater sensitivity to price30–32 41 42 and therefore are assumed to decrease consumption of SSBs proportionally more in response to a tax. Modelling studies from high-income countries have shown greater reductions for lower income groups 41 42.…”

Section: Discussionmentioning

confidence: 99%

“…Own-price and cross-price elasticities for each beverage category (carbonated soft drinks, milk, diet drinks, fruit juice) for each income quintile were estimated from published international sources, as Indonesian estimates were not available 30–34. Own-price elasticity estimates were derived from demand system analyses for Mexico (73 311 households), Ecuador (38 234 households) and New Zealand (6028 households) (table 1).…”

Section: Methodsmentioning

confidence: 99%

The potential impact of taxing sugar drinks on health inequality in Indonesia

Veerman

2018

BMJ Glob Health

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BackgroundEvidence suggests reducing consumption of sugar-sweetened beverages is important to reducing weight gain and chronic disease risk. Indonesia’s large population is a growing market for sugar-sweetened beverages. Taxation to reduce consumption is of interest, but considered fiscally regressive. Little is known about differential effects between income groups in low-income countries.MethodsThis modelling study uses a proportional multistate life table to model reduced daily energy intake following a $0.30 per litre tax on sugar-sweetened beverages and subsequent shifts in Body Mass Index (BMI) distribution for income groups in Indonesia. Energy balance equations calculate reduced BMI. Reduced incidence of type 2 diabetes mellitus, ischaemic heart disease and stroke is determined from the relative risk of the BMI shift and subsequent health-adjusted life years gained calculated.ResultsThe tax’s effect was greater for higher income quintiles than lower. Energy intake reduced most in higher income quintiles. Cases of overweight and obesity for women decreased by approximately 15 000 in the lowest income quintile, but 417 000 for the highest. For men, this was 12 000 and 415 000. Over 25 years, 63 000 cases of diabetes were averted in the lowest quintile and 1 487 000 in the highest. Similar magnitudes were observed for stroke and ischaemic heart disease. Tax paid over 25 years was $0.5 billion for the lowest income quintile and $15.1 billion for the highest.ConclusionSugar-sweetened beverage taxation can help to reduce the number of overweight and obese, and prevent over a million cases of diabetes in Indonesia. Higher income groups would benefit more than lower income groups. The tax would raise $920 million in the first year and $27.3 billion over 25 years.

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The Effect of Price and Socio-Economic Level on the Consumption of Sugar-Sweetened Beverages (SSB): The Case of Ecuador

Cited by 48 publications

References 17 publications

Impacts of Excise Taxation on Non-Alcoholic Beverage Consumption in Vietnam

Impacts of Excise Taxation on Non-Alcoholic Beverage Consumption in Vietnam

Designing a tax to discourage unhealthy food and beverage purchases: The case of Chile

The potential impact of taxing sugar drinks on health inequality in Indonesia

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