Fat tax is usually imposed to the junk food and soda. Especially, Kerala, India, has imposed fat tax on hamburgers, pizzas, and donuts.
/Extracted from BURGER KING website
On July 24th, the Ministry of Health & Welfare announced their plan to make a guideline and media monitoring system to investigate excessive eating on the so-called “Mmeokbang” (broadcasting eating food) trend. According to the stats, the rate of obesity is estimated to rise from 34.8 percent in 2016 to 41.5 percent in 2022. People have expressed interest in this new regulation as an attempt to begin to solve the obesity problem. Various other countries which have experienced obesity problems in their population have experimented with implementing a so-called ‘Fat tax’ to remedy the issue. A fat tax is a system which aims to discourage the consumption of food that can cause obesity. Thus, recently some people have suggested that Korea also needs to adopt fat tax.
Fat tax is unstable due to side effects
However, in some aspects the fat tax does not seem like a proper system to efficiently solve obesity. A fat tax is usually applied to junk food and soft drinks which lead to obesity. It sometimes referred to as a sugar tax. As such, there are no clear criteria for a fat tax. The contents of the fat tax system vary in every country, but some countries including Korea do not have a fat tax at all yet.
On the other hand, Denmark was the first country to introduce a fat tax law. In 2011, Denmark started to impose 2.3 percent of tax on foods that include saturated fat. However, after a year, it was abolished. The main reason was that it directly affected the economy.
First, the food with saturated fat was generally junk food or cheap food that low-income groups consume the most. After imposing the tax, the Danish government predicted that the gap between the rich and the poor would be wider. Indeed, not only were low-income groups affected but the whole economy started to shake. Since the price of the goods increased, in accordance with the Eurozone, people went grocery shopping to surrounding countries. The domestic market of Denmark experienced considerable damage.
On the American continent, the obesity problem is extreme. Mexico, in 2014, determined to impose eight percent tax on soft drinks for every liter. At first, the fat tax helped to reduce the consumption of soft drinks, but one year after, consumption level returned to their original state. It had no effect at all in the long term. How about the United States? Six of the states such as Berkeley, Chicago, and Philadelphia are now imposing sugar taxes and cities like New York and Columbia are considering to implement the sugar taxation. Each state has a different tax law, but the common feature is that the result is not as good as to be hoped.
Many countries consider fat tax as a solution for obesity
Including Mexico and the United States, over 30 countries are imposing or introducing fat taxation. Even if previous examples did not show satisfying results, it seems people still think fat tax is a suitable solution. For instance, a 14.5 percent fat tax was imposed on hamburgers, pizzas and donuts in Kerala, India in 2016 and they are observing the results. Recently, in this April, the United Kingdom (UK) applied a sugar tax to soft drinks depending on their contents.
Furthermore, Vietnam is also going to impose a ten percent sugar tax next year. Quang Nguyen Ngoc (24) from Vietnam said “Oh, I agree with imposing fat tax. As foreign beverage importers have to pay more fees and taxes, it would create a barrier for importers to promote their products in Vietnam. Customers would select domestic producers as preferred choice. He added “Also, the price of sugary beverages could increase a little bit by tax but in general all beverage companies would not easily increase the price in sudden.” Although there is no guarantee of success on fat taxes, a lot of countries are trying this tax system asthe obesity problem cannot be left alone.
Fat tax might not be the best way to solve the obesity problem
In fact, a few years ago, when it was introduced overseas, fat tax was an issue in Korea. Again, it became a hot topic and there are controversies on the necessity of a fat tax.
Oh Yeong-min, the professor of the Public Administration Major commented “I have doubt that fat tax would be effective. It is just giving burden to lower-income group. Higher-income group can afford healthy and fresh diet while lower-income group cannot. So, rather than regulation of food, I think welfare system, which helps lower-income people to take care of their health, is more effective solution.”
According to Korea’s rising rate of obesity, it suggests that time has come to consider the best way to control this situation. Only time will tell if it is an appropriate measure.
Opinions of Fat Tax
As the suitability of fat tax is in controversy among experts and governments, the public has opposed ideas as well. The Dongguk Post has interviewed three university students to listen to their opinions about fat tax.
Ban Su-in (Junior, Business Administration) of Gangwon National University
“I think it is sort of a paper administration. Low income group usually consumes junk food or soda which is subject to fat tax because it is cheap. If prices of those increase, some people can choose other food, but for the poor, they do not have any other options to choose. They are the most vulnerable to inflation.”
Jang Eun-jin (Junior, Philosophy) of Duksung Women’s University
“I have quite a different view on this policy. How about cigarette? The government controls the price of the cigarette and many people understand that movement. It is one of their efforts to reduce the consumption of cigarettes whether it works or not. Likewise, fat tax is similar with this case. We should not just oppose to it. It might have good results in Korea.”
Yun Ye-bin (Senior, Land Administration) of Gangwon National University
“I understand that the fat tax’s purpose is to solve the obesity problem and ultimately is to take care of the nation. However, with the only reason that the food is one of the causes of obesity, rise in price is not persuasive. There might be a better way. I think it is the government’s duty to find it.”
Seo Yoo-jeong firstname.lastname@example.org
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