According to the Ministry of Health of the Federal Republic of Germany, after the introduction of the “sugar levy” (Zuckerabgabe) in early 2028, the corresponding payments will amount to 450 million euros annually. And these funds will not go to the federal budget, but will be reserved for investment in the health care system, writes DW.
“Sugar levy” – a staggered system of payments
Although the exact details regarding the tax are not contained in the health reform bill, a panel of experts, which published its recommendations in March, has proposed a staggered payment system. Beverages with less than 5 grams of sugar per 100 ml should not be taxed. For drinks with 5-8 grams of sugar per 100 ml, it would be 0.26 euros/liter, while those with more than 8 grams would be 0.32 euros/liter.
German Health Minister Nina Warken of the conservative Christian Democratic Union (CDU) said she supported such measures. But, she said, the government has yet to discuss the details and ultimately the decision on fiscal policy still rests with the finance ministry.
Some CDU members have already expressed concern. At the party’s Conservative congress in February, there was heated debate over the issue, with fears that the initiative would make politicians look like they know better than voters what they should drink and how they should live.
Doctors and nutritionists are unanimously “in favor of the sugar levy”
For German doctors and nutritionists, the benefits of the proposed measures are obvious. Thus, the head of the Department of Public Health and Nutrition at the University of Bayreuth, Professor Peter Philipsborn (Peter Philipsborn) recalled that more than 100 countries have already introduced taxes on sugary drinks. And studies have shown – it brings benefits.
“Overall, the evidence is pretty clear that such taxes reduce the consumption of sugary drinks. Their regular consumption, as we know from many other studies, leads to weight gain and an increased risk of obesity and related diseases,” Philipsborn noted in an interview with DW.
Studies have also shown that Germans consume more sugar contained in soft drinks than residents of any of the 10 most populous countries in Western Europe. According to data published in February by the consumer protection organization Foodwatch, the average daily amount of sugar contained in drinks per German resident is about 26 grams, which is more than in the chocolate and candy eaten by Germans (20 grams).
In the UK, where a sugar tax was introduced in 2018, the average person consumes only 16 grams of sugar per day. The example of the British also demonstrated that manufacturers responded to the introduction of the tax not by raising prices, but by reducing the amount of sugar in their products. By 2019, the amount of sugar in soft drinks had decreased by 35%.
Enterprises are not confident in the effectiveness of the sugar tax
However, entrepreneurs from the food industry are not convinced by the above facts. They point out that despite the “sugar levy”, the percentage of obese children in the UK is higher than in Germany.
According to Manon Struck-Pacyna of the German Food Industry Association (Lebensmittelverband Deutschland), which includes about 250 companies and firms, the introduction of sugar taxes in other countries may have only led to a reorientation of their inhabitants’ consumption towards other sweet products.
“This is the so-called substitution effect. Under the guise of preventive health measures, certain policies are implemented, but they do not necessarily have a real effect: there is no evidence that people become slimmer as a result,” says Struk-Patsina.
That said, the scientific evidence seems to be mixed. A statement in support of a tax on sugary drinks signed in April by several dozen German health organizations and scientists, including Peter Philipsborn, said studies on the issue found no evidence that a sugar tax led to increased consumption of other sugary foods.
Is the new tax an additional burden on business?
For its part, Struck-Patsina warns that a tax on sugary drinks will inevitably lead to higher costs for consumers – at least in the short term.
“In addition to taxes, companies will have increased costs related to bureaucratic procedures. They will have to analyze all the drinks in their range and find out the sugar content in each of them to decide on the categorization. This requires costs, which will also be passed on to consumers,” says a spokeswoman for Lebensmittelverband Deutschland.
In her opinion, this will have a particularly negative impact on small and medium-sized companies that may only have one specialty drink: “If the flavor changes, the company has a problem – it could easily disappear from the market.
“Sugar levy – a tax on the poor?
Another argument from critics is that the “sugar levy” disproportionately affects specifically low-income households. They spend most of their budget on food and often on sugary drinks.
However, Prof. Peter Philipsborn is convinced that the health benefits for low-income Germans will more than compensate for such concerns: “The additional burden of the tax on sugary drinks remains quite low, on average a few euros per household per year. This is not a significant amount. When assessing the social impact of taxes, what is more important is not who pays them, but who benefits from the tax revenue.”
“The sugar levy, the professor believes, will benefit the poorest segments of the population. Even if they have to pay a little more tax, they are the ones who are likely to receive the greatest health benefits, since they are the ones who are disproportionately more likely to suffer from diseases associated with high sugar consumption. In other words, this tax leads to greater social equity.
Nevertheless, experts agree that this step alone is not enough. An effective health policy requires a set of measures to actually reduce the percentage of obese people in the long term. This includes healthier food in schools and kindergartens, measures to protect children from junk food advertising, better nutrition in canteens and lower taxes on healthy food.
The “sugar tax” bill has yet to be discussed and approved in the Bundestag – and the political debate is likely to continue.
Logos Press Remark : The recent world history of the “sugar tax for health care” goes back at least a decade.
Conventionally, industrial sugar consumers consider its official beginning to be the harsh administrative and financial measures to restrict the use of sugar in complex products in Israel. The legislation there provided not only for targeted tax levies, but also for labeling products with added sugar with a special sign – the image of a spoon with sugar (which later disappeared from products).
The topic of harmful excess sugar was picked up in the USA (however, if you think about it, the health aspect in the mass consciousness of ordinary people is partly offset by the trend towards politically correct and non-discriminatory body positivity).
In the European Union, tax restrictions on sugar consumption in Latvia are cited as a vivid example of the fight against one of the forms of “white death”.
Now Germany – not only one of Europe’s largest consumers but also producers of sugar – is joining this topic.
Perhaps it is just a coincidence, but the idea of a “sugar levy” in the country appeared at the time when the European (as well as the world) sugar market, after a phase of cyclical growth, entered a phase of cyclical decline in prices for this product. If before the consumption of sugar-containing drinks was partly restrained by high sugar prices, now this “limiting factor” is shrinking sharply. And the “price fork” between conventionally healthy fruit/juice-containing drinks and sugar-containing drinks is widening.
From this point of view, it is not surprising that in the context of falling sugar prices, the relevance of health is growing.
At the same time, the idea (hypocritical if you think about it) of having to pay more taxes in the name of fighting for health and quality of life leaves a not very sweet taste. Especially for those who compensate their lack of money for healthy and sufficient (!) nutrition with cheap carbohydrates.
