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Unhealthy snack taxes

Health Factors: Diet & Exercise
Decision Makers: Local Government State Government Federal Government
Evidence Rating: Some Evidence
Population Reach: 100% of WI's population
Impact on Disparities: Likely to decrease disparities

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Description

Snack taxes are generally applied to unhealthy products high in sugar and fat. Adding an excise tax (a fee per ounce) or a sales tax (a percentage of the product’s price) to the current price of unhealthy products increases the price of unhealthy snacks for consumers. The funds generated may be used to subsidize healthy foods or to support other public health ventures.

Expected Beneficial Outcomes

Reduced unhealthy food consumption
Improved weight status

Evidence of Effectiveness

There is some evidence that snack taxes reduce consumption of unhealthy foods, especially when taxes are larger and more broadly applied (Niebylski 2015AHA-Mozaffarian 2012, Eyles 2012Sacks 2011, Epstein 2010, French 2001). Unhealthy snack taxes increase the price of snacks for consumers (Cawley 2015); taxes that change the relative prices of healthy and unhealthy foods have been shown to affect both consumption patterns and obesity levels (Urban-Engelhard 2009, Eyles 2012). Small taxes appear to have little effect on consumption, however, larger price increases may more effectively change consumption (AHA-Mozaffarian 2012, Niebylski 2015). Additional evidence is needed to confirm effects.

Increasing fast food prices has been associated with improved weight status, particularly among adolescents (Powell 2013), and a higher likelihood of fruit and vegetable consumption (AHA-Mozaffarian 2012). Broader application of snack taxes may be necessary to avoid shifts in unhealthy eating behavior (Cawley 2015), for example, model-based studies suggest that a saturated fat-only tax may increase sodium consumption (Eyles 2012). States without snack (or sugar sweetened beverage) taxes are more likely to have high increases in state-level obesity prevalence than states with snack taxes in place (Kim 2006). Taxes in small geographic areas may also have minimal effects on consumption, since consumers can easily purchase unhealthy snacks in neighboring areas without such taxes (Cawley 2015). 

Price changes are likely to have a greater effect on the purchasing decisions of low income families than higher income families, as low income families spend a larger portion of their income on food (Rudd-Friedman 2012), and the decision making of youth than adults (AHA-Mozaffarian 2012). Greater reductions in consumption of unhealthy snacks may lead to more health benefits and larger reductions in obesity rates among low income families and youth (Eyles 2012, AHA-Mozaffarian 2012, Rudd-Friedman 2012).

Snack taxes have the potential to raise significant funds that could be used to subsidize fresh fruits and vegetable purchases for low income households or support other obesity prevention efforts (AHA-Mozaffarian 2012). States can also provide tax credits or rebates to low income households to encourage substitutions, minimizing the regressive income effect of such a tax (Cawley 2015). 

Implementation

United States

The Navajo Nation is the first US community to pass a tax on junk food; the Healthy Diné Nation Act of 2014 includes a 2% tax on the sale of all food items with minimal to no nutritional value. All revenue collected from this tax is allocated to the Community Wellness Development Projects Fund, which supports projects to improve the community’s physical and social environment, such as community gardens, healthy food initiatives, farmers’ markets, playgrounds, walking and biking trails, or swimming pools (Navajo-Snack tax, TNS-Duara 2015).   

Bridging the Gap provides annual state sales tax rates for snack products, including candy, chips, pretzels, ice cream, popsicles, milkshakes, and baked goods for all 50 states and Washington DC (BTG-Soda or snack).

Wisconsin

Wisconsin does not have a snack tax (BTG-Soda or snack).

Citations - Evidence

AHA-Mozaffarian 2012 - Mozaffarian D, Afshin A, Benowitz NL, et al. Population approaches to improve diet, physical activity, and smoking habits: a scientific statement from the American Heart Association (AHA). Circulation. 2012;126(12):1514–63. Accessed on February 6, 2017
Cawley 2015* - Cawley J. An economy of scales: A selective review of obesity's economic causes, consequences, and solutions. Journal of Health Economics. 2015;43:244-268. Accessed on February 2, 2017
Epstein 2010* - Epstein LH, Dearing KK, Roba LG, Finkelstein E. The influence of taxes and subsidies on energy purchased in an experimental purchasing study. Psychological Science. 2010;21(3):406-14. Accessed on February 4, 2016
Eyles 2012 - Eyles H, Ni Mhurchu C, Nghiem N, Blakely T. Food pricing strategies, population diets, and non-communicable disease: A systematic review of simulation studies. PLoS Medicine. 2012;9(12):e1001353. Accessed on February 2, 2017
French 2001* - French SA, Story M, Jeffrey RW. Environmental influences on eating and physical activity. Annual Review of Public Health. 2001;22:309–35. Accessed on February 2, 2017
Kim 2006 - Kim D, Kawachi I. Food taxation and pricing strategies to “thin out” the obesity epidemic. American Journal of Preventive Medicine. 2006;30(5):430-7. Accessed on March 3, 2016
Niebylski 2015* - Niebylski ML, Redburn KA, Duhaney T, Campbell NR. Healthy food subsidies and unhealthy food taxation: A systematic review of the evidence. Nutrition. 2015;31:787-795. Accessed on February 2, 2017
Powell 2013* - Powell LM, Chriqui JF, Khan T, Wada R, Chaloupka FJ. Assessing the potential effectiveness of food and beverage taxes and subsidies for improving public health: A systematic review of prices, demand and body weight outcomes. Obesity Reviews. 2013;14(2):110–28. Accessed on February 2, 2017
Rudd-Friedman 2012 - Friedman R, Brownell K. Sugar-sweetened beverage taxes: An updated policy brief. New Haven: Yale Rudd Center for Food Policy & Obesity; 2012. Accessed on February 2, 2017
Sacks 2011* - Sacks G, Veerman JL, Moodie M, Swinburn B. “Traffic-light” nutrition labelling and “junk-food” tax: A modelled comparison of cost-effectiveness for obesity prevention. International Journal of Obesity. 2011;35(7):1001-9. Accessed on November 9, 2015
Urban-Engelhard 2009 - Engelhard C, Garson A, Dorn S. Reducing obesity: Policy strategies from the tobacco wars. Washington, DC: Urban Institute; 2009. Accessed on February 4, 2017

Citations - Implementation

BTG-Soda or snack - Bridging the Gap (BTG). Soda/snack taxes. Accessed on February 2, 2017
Navajo-Snack tax - The Navajo Nation Council. Resolution of the 22nd Navajo Nation Council: The Healthy Diné Nation Act of 2014; 2014:CN-54-14. Accessed on December 17, 2015
TNS-Duara 2015 - Tribune News Service (TNS), Duara N. Navajo Nation experiments with junk food tax. Governing the States and Localities. 2015. Accessed on December 17, 2015

Page Last Updated

May 5, 2016

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