If the national government will have its way, it would rather tax higher products like oil and fuel, and motor vehicles, than collect a tax on sweetened beverages. And perhaps rightly so, just to keep food and drinks affordable and more accessible to the poor. After all, expensive food can make or break a government.
But, if it were up to the House of Representatives, it will tax most types of sweet drinks at P10 to P20 per liter, which, according to food and drinks makers, can increase the prices of sweetened beverages by 30% to 100%. These drinks include soft drinks, sweetened juices, 3-in-1 coffee, and other drinks normally sold by sari-sari stores and consumed by the masses.
As for beverage makers themselves, they want the Senate to revise the House’s plan and to tax only drinks with “caloric” sweeteners (or those with calories) like sugar and High Fructose Corn Syrup, and depending on actual caloric sweetener content. In this line, it appears that they want to keep tax-free all drinks with “non-caloric” sweeteners, which are usually artificial.
If the Senate is keen on meeting the twin objectives of boosting tax collection, and fighting obesity and diabetes, I suggest it carefully reviews the “caloric” proposal put forward by the Beverage Industry Association of the Philippines or BIAP. Senators should endeavor to make a well-informed decision by updating themselves with the latest independent studies on this.
Whether artificial or non-caloric sweeteners (with low to zero calories) can still lead to diabetes, a very recent study by Yale University indicates a possible link between the two. Thus, if the government is truly bent on controlling diabetes, I believe it should go beyond just sugared beverages. Artificial sweeteners, in drink or food, have the same effect, it seems.
Author Bill Hathaway detailed for YaleNews how the Yale study published only last Aug. 10 found that sweet taste, and not calories, dictated the body’s metabolic response to sugar and alternative sweeteners. The study noted that calories was not the only basis for determining whether a sweetener could result in diabetes.
“When sweet taste and calories do not align, the body’s metabolism is fooled, a finding that may help explain the link between artificial sweetener use and diabetes,” Hathaway wrote of the new Yale University study published in the medical journal Current Biology.
“In nature, sweetness signals the presence of energy and its intensity reflects the amount of energy present. When a beverage is either too sweet, or not sweet enough, for the calories it contains, the metabolic response and the signal that communicates nutritional value to the brain are disrupted,” YaleNews reported.
“A sweet-tasting, lower-calorie drink can trigger a greater metabolic response than drinks with higher calories, explaining the association between artificial sweeteners and diabetes discovered in earlier studies,” it added.
YaleNews is an online news bulletin managed by the Office of Public Affairs & Communications of Yale University, which is a privately owned research-based university in Connecticut that was founded in 1701. It is the third-oldest institution of higher education in the United States and one of the nine Colonial Colleges chartered before the American Revolution.
Its latest research on sweeteners, released only early this month, received primary funding from the National Institutes of Health (NIH) and PepsiCo. NIH, a unit of the US Department of Health and Human Services, is the US medical research agency. It invests approximately $32 billion annually in medical research. PepsiCo, meanwhile, is a $63-billion global food and drink manufacturer and distributor with headquarters in New York.
The new Yale study, which I believe to be important, reported how “sweetness helps to determine how calories are metabolized and signaled to the brain,” which prompted study senior author Dana Small, a professor of psychiatry at Yale University School of Medicine, to comment that “a calorie is not a calorie.”
She noted that when “sweetness and calories are matched, the calories are metabolized, and this is registered by brain reward circuits. However, when a ‘mismatch’ occurs, the calories fail to trigger the body’s metabolism and the reward circuits in the brain fail to register that calories have been consumed.”
“In other words, the assumption that more calories trigger greater metabolic and brain response is wrong,” Small was quoted by YaleNews. “Calories are only half of the equation; sweet taste perception is the other half,” she said of the findings of the study, which was co-authored by Yale’s Maria Geraldine Veldhuizen and Richard Keith Babbs.
Small also noted that many processed foods contain such mismatches — such as a yogurt with low calorie sweeteners. “Our bodies evolved to efficiently use the energy sources available in nature. Our modern food environment is characterized by energy sources our bodies have never seen before,” she added.
Meanwhile, a story on the Yale study by The Telegraph, a British national daily circulated internationally, had Tam Fry of the UK’s National Obesity Forum commenting that, “this research [by Yale] should be enough to convince you that artificial ingredients, whether they be in food or drink, can screw up your system even though they may sound healthy. They may be free of calories but not of consequences and diabetes is only one of them.”
However, other British experts are more skeptic, saying the Yale study needs further work. Like Naveed Sattar, professor of Metabolic Medicine at Glasgow University, who told The Telegraph that “there is currently no strong evidence that diet drinks are necessarily bad for you.” But, he also said that, “overall, my advice to people drinking sugar-rich drinks, would be to replace [these] with water.” He noted that “whether diet drinks also help weight loss or other benefits is uncertain, and requires proper long-term trials which are currently lacking.”
My point in all this is that it is only now that more medical findings are becoming public with respect to the use of sugar and artificial sweeteners. The jury is still out whether diabetes, and maybe obesity, is caused only by sugar and other caloric sweeteners, and that artificial or non-caloric sweeteners are the future of “sweetened” food and beverages.
Taxation is a tool to help raise revenues for the government, but at the same time it can drive consumption and behavior towards a particular or specific direction presumably for the common good. This is precisely why we tax high all cigarettes and tobacco products, and now impose restrictions on smoking, to help curb public consumption of what is deemed a harmful product — while raising additional government revenues in the process.
But processed food and drinks, and its components like sugar and artificial sweeteners, unlike cigarettes and liquor, have dietary or nutritional benefits as well. The last thing we want to do now is to heavily tax sugar content and caloric sweeteners, thinking this is the right thing to do in addressing obesity and diabetes.
Such action can drive drinks and food makers as well as consumers toward artificial sweeteners. Production and consumption may shift to alternative sweeteners, or a combination of both caloric and non-caloric sweeteners, to keep products affordable even with a government tax imposed.
But, in the not-too-distant future we might see more studies like that of Yale that will prove that artificial or non-caloric sweeteners have the same health consequence such as obesity and diabetes, and perhaps should have been taxed as well. We need to tread carefully on this, and perhaps wait for a more opportune time to consider pulling the tax lever.
Legislators should consider more compelling local information, data, statistics, medical research, and clinical findings that can help them make a very well-informed decision on whether or not to tax sweetened beverages. I believe the matter should not be considered lightly, given its future implications on consumption and public nutrition and public health.
Marvin A. Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippines Press Council.
