Geneva, Switzerland

The World Health Organization (WHO) called on countries to raise taxes on alcohol and sugar-sweetened beverages (SSBs), on Tuesday (Dec 5) while noting that a majority of the countries do not incentivise healthier behaviours. 

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The recommendations were based on the United Nations health agency's study of the taxation rates which found that the average global tax rate on such “unhealthy products” was low, and hiking taxes could result in healthier populations and reduce the deaths they cause. 

“WHO recommends that excise tax should apply to all sugar-sweetened beverages (SSBs) and alcoholic beverages,” said the UN agency in a statement. Excise taxes target specific consumer products. 

Millions of deaths due to alcohol and SSBs

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Around 2.6 million people across the world die from drinking alcohol, while more than eight million die from having an unhealthy diet, according to WHO, adding that implementing a tax on them “will reduce these deaths.”

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The UN agency also said that raising the tax will not only help reduce the consumption of these beverages but also incentivise companies to make healthier products. 

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“Taxing unhealthy products creates healthier populations. It has a positive ripple effect across society, less disease and debilitation and revenue for governments to provide public services,” said Rüdiger Krech, the UN agency’s health promotion director, in the statement. 

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

The tax on these products would also help prevent non-communicable diseases such as cancers, diabetes and heart diseases, said the UN health agency. 

What else did WHO find?

The report also noted that half of all countries taxing SSBs are also taxing water – not something that the WHO recommends. Around 108 countries of its 194 members impose some taxation on SSBs. Globally, excise taxes on average represent just 6.6 per cent of the price of a soda.

Additionally, at least 148 countries have applied excise taxes to alcohol at the national level. However, wine is exempted from excise taxes in at least 22 countries, most of which are in Europe, said WHO. 

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The tax, according to the UN agency, on the price of the most sold brand of beer is 17.2 per cent. Meanwhile, the tax on "the most sold brand of the most sold type of spirit" is 26 per cent.

“A significant body of research has demonstrated that people who engage in heavy episodic drinking tend to drink the cheapest available alcoholic beverages,” said the WHO. 

The report citing a 2017 study said taxes that increase alcohol prices by 50 per cent would help avert over 21 million deaths over half a decade and generate nearly $17 trillion in additional revenues. 

(With inputs from agencies)