There are different forms such a tax … Dušek, L., Janský, P. (2012a), "Changes in Value Added Tax: How Much do They Affect Households? Excessive saturated fat consumption is a risk factor for heart disease, so lowering consumption should lead to a reduction in the incidence of heart disease, all else equal. Dušek, L., Janský, P. (2012b), "Tax Reform Proposals: How Much Do They Bring to the Public Sector Budgets? https://www.ced.org/blog/entry/the-skinny-on-the-fat-tax, http://www.ncpa.org/sub/dpd/index.php?Article_ID=23248. The World Health Organization (WHO) has recommended the use of fiscal policy to influence food prices “in ways that encourage healthy eating”.1,2 Although this is consistent with growing worldwide interest in the effect of fiscal policy on diet,3–5evidence supporting the use of taxes is weak. The work was carried out under contract SANCO/2005/C4NUTRITION-03, funded by the European Commission. Available at: http://apl.czso.cz/nufile/GNI_CZ_en.pdf. Janský, P. (2013), "Changes in Excise Duties and their Impact on Households in the Czech Republic." (2009), "Food Prices and Obesity: Evidence and Policy Implications of Taxes and Subsidies." Prague: Grada Publishing. 344, No. Lin, B. H., Smith, T. A., Lee, J. Y., Hall, K. D. (2011), "Measuring Weight Outcomes for Obesity Intervention Strategies: The Case of a Sugar-Sweetened Beverage Tax." Attribution-NonCommercial-NoDerivatives 4.0 International License. Thiele, S. (2010), "Fat Tax: A Political Measure to Reduce Overweight? Bowman S. A. 229-257, http://dx.doi.org/10.1111/j.1468-0009.2009.00554.x. We evaluate the impact of three types of fat taxes: ad valorem, specific per kilogram of product and specific per kilogram of fat. The economic effects of the fat tax were almost invariably negative. VZP ČR, denoted VZP (2011) in the text. 45-55. Create your own unique website with customizable templates. Czech Statistical Office (2002), Gross National Income Inventory (according to ESA 1995). 329-341, http://dx.doi.org/10.1016/j.ehb.2011.08.007, Madden, D. (2013), "The Poverty Effects of a 'Fat-Tax' in Ireland." ÚZIS ČR, denoted ÚZIS (2012) in the text. Nutrition Bulletin, Vol. Others claim that if we reduce taxes , almost all of the benefits will go to the rich, as those are the ones who pay the most taxes. 624-639, http://dx.doi.org/10.1016/j.foodpol.2007.03.002, Smed, S. (2012), "Financial Penalties on Foods: The Fat Tax in Denmark." One of the most widely discussed interventions is the ‘fat tax’, which is an umbrella term for a host of policies aimed at altering the relative prices of foods in an effort to encourage healthier eating. Interní Medicína, Vol. 5-6, pp. Jensen, J. D., Smed, S. (2007), "Cost-Effective Design of Economic Instruments in Nutrition Policy." 1, pp. 37, No. In Hungary the tax was levied on a broad range of food and drinks containing salt, sugar or caffeine, thus the estimated effects are not directly comparable but can complement the findings from Denmark. 45499. This paper examines how changes to the individual income tax affect long-term economic growth. American Journal of Public Heath. Interestingly, they have done so with no economic penalty. Estimating the QUAIDS Demand System on Czech Household Budget Survey Data." (Blackwell-Synergy) . Prague University of Economics and BusinessPrague Economic Papers(SB 310C)W. Churchill Sq. The proceeds from a fat tax could be used as subsidies for healthy foods. Social cost. Food Policy, Vol. Unhealthy diets lead to obesity. 347-349. Economic Effects of a Fat Tax When the Danish government first implemented the fat tax, the expected tax revenue was 1.2 billion kroner ($183,445,644). Prague University of Economics and Business. These taxes have not yet been implemented in the Czech Republic, in contrast to some other, mainly European countries. 9, No. ECSIP. We find that a fat tax has small and ambiguous effects on nutrients purchased by French households, and a slight effect on body weight in the short run, with a greater effect in the long run. Jensen and Smed (2013) conclude that the Danish fat tax had a 10–15% negative short-run effect on the consumption of saturated fats. It was blamed for helping inflation rise to 4.7 per cent in a year in which real wages fell by 0.8 per cent. A fat tax is a tax or surcharge that is placed upon fattening food, beverages or on overweight individuals. Prague Economic Papers is published by Prague University of Economics and Business. However, the introduction of a fat tax has been discussed frequently in the Czech Republic during the last few years; here, we provide empirical evidence in order for this public debate to be better informed. Introduction. Fat-tax An Economic Analysis Executive Summary A tax on food containing fat (a "fat-tax") is meant to be a key measure in government policy directed at the issue of obesity. 8, pp. (2006), "Food Taxation and Pricing Strategies to "Thin out" the Obesity Epidemic." This website including articles are licensed under the Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY NC ND 4.0). The structure and financing of a tax change are critical to achieving economic growth. Institute of Health Information and Statistics of the Czech Republic (2012), Zemřelí 2011. ODI Report. 142-147, http://dx.doi.org/10.1111/j.1467-3010.2012.01962.x. Various forms of the fat tax have a… At least ten per cent of fat tax revenues were swallowed up in administrative costs and it was estimated to have cost 1,300 Danish jobs. Institute for Fiscal Studies. Many Danes switched to cheaper brands or went over the border to Sweden and Germany to do their shopping. ECORYS (2014). 1. (2007b), "Dopad harmonizace sazeb DPH v ČR." Advocates of tax cuts claim that a reduction in the tax rate will lead to increased economic growth and prosperity. The inflation rate ended up rising 4.7% in one year making real wages fall by .8%. The ‘fat tax’: economic incentives to reduce obesity Andrew Leicester and Frank Windmeijer* Institute for Fiscal Studies 1. Brůha, J., Ščasný, M. (2006), "Distributional Effects of Environmental Regulation in the Czech Republic." One reservation about such a policy is the impact it would have on poorer families, as Economic implications from introducing Fat Taxes. Teplan, V. (1998), Praktická nefrologie. Food taxes and their impact on competitiveness in the agri-food sector. Taxing junk food to counter obesity. Politická ekonomie, Vol. Prague Economic Papers, Vol. For example, eating unhealthy foods contributes to the problem of obesity. The Poverty Effects of a Fat Tax in Ireland. These costs are due to (2004), "Who Pays Taxes and Who Gets Benefits in the Czech Republic." Therefore we should introduce a pigovian tax to correct the over-consumption of unhealthy food. Public Finance Review, Vol. Grandi and M.J. Eisenberg (2013). 2, pp.133-149. 2, pp. 11, pp. 15, No. This is an open access article distributed under the terms of the Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY NC ND 4.0), which permits use, distribution, and reproduction in any medium, provided the original publication is properly cited. More about Essay about A Fat Tax: Economic Costs of Obesity are High. 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