Mexico’s tax on sugary drinks doesn’t dent demand

Global Business

Mexico’s tax on sugary drinks doesn’t dent demand2

Mexico, having high obesity and diabetes rates, has imposed a so-called “sugar tax” on soft drinks.

CCTV America’s Franc Contreras has this report on the how rising taxes has affected soft drink consumption.

Mexico\'s tax on sugary drinks doesn\'t dent demand

Mexico\'s tax on sugary drinks doesn\'t dent demand

Mexico, having high obesity and diabetes rates, has imposed a so-called “sugar tax” on soft drinks. CCTV America’s Franc Contreras reports.

According to the World Health Organization, each person in Mexico consumes more than 160 liters (42 US gallons) of soft drinks per year. Nutrition experts said that number goes hand-in-hand with skyrocketing rates of obesity and diabetes.

In an effort to reduce high rates of obesity and diabetes, the Mexican government levied a “sugar tax” two and a half years ago.

Mexico’s National Institute of Public Health initially recommended taxing sugary drinks double what it is now.

However, in large and small stores across Mexico, the government’s decision to raise taxes on these products appears to have had no impact at all on sales.

Nevertheless, Jorge Terrazas, the director of Anprac, Mexico’s national association of soft drink producers, said new sales trends are emerging.

“Consumers are demanding more and more products with other options with low or no calories. A segment of the population has this vision. It’s a new culture, a more sophisticated and younger consumer,” Jorge said.

With Mexico’s sugar tax still in place, the expected decrease in consumption of sugary drinks has not materialized so far.


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