DOMESTIC SALES volume of beverage company Zest-O declined around 30% last year due to the sugar tax on beverages implemented in 2018, Zest-O Chairman Alfredo M. Yao said.
Mr. Yao told reporters at a business forum that Zest-O has seen some recovery in sales this year and is still growing as it taps overseas markets like Indonesia.
He said the entire beverage industry’s sales was likely also down around 30% in 2018 and will take another two years to recover.
“Everywhere that there is a tax on drinks, there is an adjustment period,” he said.
The Philippines last year implemented an excise tax on sugar-sweetened beverages. Euromonitor sales data from 2018 reported that the tax has lowered sweetened beverage consumption by an average of 6.5%.
Zest-O decreased the size of their products after the implementation of the excise tax.
“Soft drinks are supposed to be a poor man’s drink,” Mr. Yao said, adding that pricier sugary drinks like milk tea should be taxed.
Despite the decline, Zest-O is still the market leader in the beverage industry.
“We are still the leader because we have a lot of brands,” Mr. Yao said.
Zest-O plans to further expand its beverage footprint across Southeast and East Asia, including China and Indonesia. — Jenina P. Ibañez
