Food taxes and subsidies 'could improve health'

Updated at 11:26 pm on 12 December 2012

Diet experts say taxing fizzy drinks and fatty foods and subsidising fruit and vegetables could improve the country's health.

Researchers at the universities of Auckland and Otago came to the conclusion after analysing 32 studies from OECD countries on how pricing affects what people eat and drink.

The study found increasing the price of soft drinks by 10% could reduce consumption by up to 24%, while decreasing the cost of fruit and vegetables by 10% could increase consumption by up to 8%.

An expert in population nutrition at Auckland University, Boyd Swinburn, says poor diet is now a bigger cause of ill health than smoking in countries like New Zealand and the Government needs to consider fiscal controls for fatty foods.

But Canterbury University economist Eric Crampton says while healthy eating taxes seem simple they are a nightmare to administer.

Dr Crampton says Denmark has recently abandoned taxes on saturated fat because it was too hard to define which foods are healthy and which are not.

However Professor Swinburn says taxes could work if the Government focuses on types of food and drink that are easy to define, such as in Australia where there is no GST on fruit, vegetables and other health products.

The research has been published in the open-access journal Public Library of Science Medicine.

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