WHO restates calls for increased taxes on alcohol, sugary beverage

The World Health Organisation (WHO) has restated its call on countries to increase taxes on alcohol and sugary drinks to counter their negative effects on global health and promote healthy behaviour.

The organisation in its report on alcohol and sugary drink taxes published on Tuesday said the average global tax rate on such “unhealthy products” is low and hiking taxes could improve consumers’ health.

It said implementing tax on alcohol and Sugar-Sweetened Beverages (SSB) will reduce deaths caused by them.

“Although 108 countries are taxing some sort of sugar-sweetened beverage, globally, on the average excise tax, a tax designated for a specified consumer product, represents just 6.6 per cent of the price of soda,” WHO said.

Meanwhile, around 148 countries have applied excise taxes to alcoholic beverages at the national level. However, wine is exempted from excise taxes in at least 22 countries, most of which are in Europe, the WHO wrote.

The organisation said globally, on average, the excise tax share in the price of the most sold brand of beer is 17.2 per cent and for the most sold brand of the most sold spirits type, it is 26.5 per cent.

It also stated that half of all countries taxing SSBs are also taxing water – adding that this is not recommended.

The director of health promotion at WHO, Rűdiger Krech, said taxing unhealthy products creates healthier populations.

Mr Krech said this also has a positive ripple effect across society – less disease and debilitation and revenue for governments to provide public services.

“In the case of alcohol, taxes also help prevent violence and road traffic injuries,” he said.

Negative effects

The organisation said globally 2.6 million people die from drinking alcohol yearly and over eight million from an unhealthy diet.

It noted that a 2017 study shows that taxes that increase alcohol prices by 50 per cent would help avert over 21 million deaths over 50 years and generate nearly US$17 trillion in additional revenues.

WHO said: “This is equivalent to the total government revenue of eight of the world’s largest economies in one year.”

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“Countries like Lithuania, which increased alcohol tax in 2017 to drive down consumption have decreased deaths from alcohol-related diseases.”

WHO said Lithuania increased alcohol tax revenue from 234 million euros in 2016 to 323 million euros in 2018 and saw alcohol-related deaths drop from 23.4 per 100,000 people in 2016 to 18.1 per 100,000 people in 2018.

It said research also shows that taxing alcohol and SSBs helps cut down the use of these products and gives companies a reason to make healthier products.

Nigeria in retrospect

In 2021, after prolonged advocacy efforts championed by the National Action on Sugar Reduction (NASR) coalition, Nigeria introduced a 10 naira per litre excise tax on non-alcoholic, sweetened carbonated beverages.

In reaction to WHO’s recommendation, the coalition has continually maintained that the tax rate is too low to make a real health impact.

It said WHO data now corroborates the coalition’s assertions.

The coalition’s co-chair and President of the Nigerian Cancer Society, Alhassan Umar, urged the government to raise SSB taxes to supplement the health budget and reduce the nation’s health system burden.

Mr Umar said this will place Nigeria on the path of achieving Universal Health Coverage (UHC).

“The WHO report puts forward considerations for earmarking tax revenue and cites examples of nine countries that currently channel tax funds towards universal health coverage, a goal which Nigeria still aspires to achieve and can be achieved through SSB tax revenue.”

Sweetened drink consumption in Nigeria

In Africa, Nigeria boasts of the largest consumer of soft drinks, according to data from Statista, a global analytics firm.

The analysis shows that Nigerians consume an estimated 40 million litres of soft drinks yearly.

A 2016 global soft drinks market analysis indicates that Nigeria is the fourth highest consumer of soft drinks in the world, after the United States, China, and Mexico.

While some concerned parties were against the government’s decision to introduce the N10 per litre tax, others believe it will discourage people from taking too much carbonated drinks, which negatively affects their health.

Nigeria is not the first country to impose an excise tax on SSB. Over 50 countries have already introduced SSB taxes to reduce the intake of such drinks and encourage manufacturers to reduce sugar content.

Robust evidence has confirmed a drop in SSB consumption following the introduction of tax in many jurisdictions, including the UK (2018), Mexico (2014), South Africa (2018), and Chile (2014).