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The Australian Beverages Council, National Retail Association and Australian Association of Convenience Stores have rejected a call for a tax on soft drinks, labelling it a misguided measure that won’t address obesity but will hit households that can least afford it. 

Launching its new position statement in Canberra, the Rethink Sugary Drink alliance – the Australian Medical Association (AMA), Cancer Council Australia, the Australian Dental Association, Food for Health Alliance, and Heart Foundation – urged the government to introduce a 20 per cent health levy on sugary drink manufacturers.

AMA president Professor Steve Robson said new research by the AMA found a 20 per cent health levy on sugary drinks could raise around $1 billion each year, which could be used to fund crucial obesity prevention and other health initiatives.

Robson said the research showed the policy could slash the amount of sugar Australians consume every year by nearly 2.6 kilograms per person, which is approximately 650 teaspoons of sugar.

“This policy really is a no brainer – it would raise vital funds for preventive health and protect Australians’ health by decreasing the risk of diseases linked to excess weight like heart disease, type 2 diabetes, stroke, and some cancers,” Robson said.

But CEO of the Australian Beverages Council, Geoff Parker, said the call was a misguided attempt to address complex problems with “a simplistic, quick fix that lacks real world evidence it has any discernible impact on weight”.

“Consumption of sugar from drinks in Australia has decreased significantly over a 20-year period at the same time obesity, overweight and diabetes rates have continued to rise. Clearly soft drinks aren’t driving the nation’s expanding waistline which makes this call for a tax illogical and clearly just a revenue raiser,” Parker said.

Parker said the last National Nutrition and Physical Activity Survey in 2011-12 showed soft drinks were ranked seventh in kilojoule contribution from discretionary food and drinks for children, and eighth for adults.

“If the public health organisations were serious about addressing obesity and overweight, we’d recommend they started at the top of the lists where discretionary kilojoules are coming from,” said Parker. 

But a 2016 University of Sydney study, published in the British Journal of Nutrition, found sugar-sweetened beverages were the largest source (30 per cent) of added sugar in Australians’ diet. It was followed by sugar and sweet spreads (24·5 per cent) and cakes, biscuits, pastries and batter-based products (24·4 per cent). “More than half of the study population exceeded the WHO’s cut-off for sugar, especially children and adolescents. Overall, 80-90 per cent of the daily added sugar intake came from high-sugar energy-dense and/or nutrient-poor foods,” it said.

Robson said the levy would raise around $4 billion over four years, providing funds for health campaigns that could reduce pressure on the health system.

“Research also shows there could be 4400 fewer cases of heart disease, 16,000 fewer cases of type 2 diabetes, and 1100 fewer strokes over 25 years if government takes this step,” he said.

In 2017, the federal health department compiled a policy context paper on sugar in Australia and New Zealand for the Australia New Zealand Ministerial Forum on Food Regulation as it started to consider changes to sugar labelling on products.

It said dietary guidelines in both countries recommended limiting consumption of added sugar, but neither provided a clear definition of what added sugars were.

“Sugars added to a food or drink by the consumer or manufacturer are commonly referred to as ‘added sugars’. Added sugars are not chemically different to sugars naturally occurring in foods such as fruit and milk, which makes it difficult to distinguish between added and naturally occurring sugars using analytical methods,” the paper said.

The paper also highlighted that there is no universally agreed definition of ‘added sugars’, with different definitions used in Australia, New Zealand, and overseas.

“The World Health Organisation (WHO) uses the term ‘free sugars’ which is defined as including sugars added to foods and drinks as well as sugars in honey, fruit juice and fruit juice concentrates,” it said.

Labelling is a key contention – differences in definitions, codes, and how it is measured mean comparisons between data and research are virtually impossible.

National Retail Association director of policy, David Stout, said, “We don’t believe Australia can tax its way to a healthier society. The responsibility lies with everyone, and education is the key.”

For Cancer Council Australia CEO, Professor Tanya Buchanan, the energy density of soft drinks with little nutritional value can lead to weight gain and obesity, a leading risk factor for 13 types of cancer.

“The Australian Government must put the community first, following in the footsteps of more than 100 countries and jurisdictions that already have a health levy on sugary drinks. Success stories from places like the UK, South Africa, and Mexico combined with a robust evidence base show us this policy can make a real difference to diets and health here in Australia.

“Importantly, we know a health levy encourages manufacturers to reformulate their drink products to contain less sugar, resulting in healthier beverages and better health outcomes,” Buchanan said.

Parker said, “While some countries have implemented taxes on drinks, there has not been a single example where these taxes have lowered the rise of obesity, overweight or diabetes. This is why some countries including Australia are looking at a more wholistic, contemporary approaches to obesity and overweight.”

Stout added, “Tax policy should not be made up without consultation, without any significant economic impact analysis, including whether it will achieve its goals and how it would affect businesses. We urge the Government to invest in education, highlighting the need for healthier choices and more exercise.”

In 2018, Australia’s largest non-alcoholic drinks companies pledged to cut the sugar in their beverages by 20 per cent by 2025. The pledge covered carbonated soft drinks, energy drinks, sports and electrolyte drinks, frozen drinks, bottled and packaged waters, juice and fruit drinks, cordials, iced teas, ready-to-drink coffees, flavoured milk products and flavoured plant milks. In the first 12 months beverage companies reduced sugar by seven per cent.

In 2020, the results of a 22-year longitudinal study were published. Sales of Sugar-Sweetened Beverages in Australia: A Trend Analysis from 1997 to 2018, published in Nutrients, found a 30 per cent decrease in per capita sugar contribution from non-alcoholic water-based beverages over 22 years. Per person that equated to a drop in consumption equivalent to 32 teaspoons, or 127 grams, of sugar.

It found Australians had shifted their beverage preferences to more low and no sugar varieties, with health a major factor in the changing consumption.

In 2022, the signatories agreed to raise the sugar reduction target to 25 per cent by 2025, up five percentage points on the target set in 2018.

CEO of the Australian Association of Convenience Stores, Theo Foukkare, said drinks fridges in convenience stores and petrol stations are evolving, with a wide variety of low and no sugar options.

“Consumers today have an extensive variety of drink options and know what’s best for them and their families,” Foukkare said.

The 2020 study found non-sugar drinks have outsold sugar-sweetened drinks since 2015, with 59 per cent of drinks in the fridge now being non-sugar and 41 per cent being sugar sweetened. In contrast to 1997, 64 per cent of drinks were sugar-sweetened, while were 36 per cent made up of non-sugar options.

Parker said, “The reduction in sugar has been achieved without price hikes to the weekly supermarket shop or making buying a drink more expensive when people are out and about. Since 2015 bottled water sales has outstripped sugar-sweetened carbonated soft drink sales and since 2022 no and low sugar drinks have accounted for more than half of all drink sales.

“Australians now drink almost five times more bottled water than they did two decades ago. Australians are making healthier choices for them and their families without another tax on their household budget. 

“The drinks industry will continue to support consumers with more choices and less sugar. We urge other sectors to play their part and commit to their own reductions in sugar, saturated fat and sodium. In 2024 we need a whole-of-industry commitment to playing its part along with government in addressing this complex problem.”

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