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Malaysia Pushed To Adopt A Soda Tax

by Mary Swire, Tax-News.com, Hong Kong

04 December 2012


The Consumers Association of Penang (CAP) has called on the Malaysian government to impose a tax on soft drinks in an effort to reduce the escalating number of diabetics among the country’s citizens.

The main purpose of a tax or surcharge on soft drinks, or "soda tax," as it is called in the United States, would be to discourage high sugar consumption, as sweetened beverages like soda drinks, other carbonated and non-carbonated drinks, and sports and energy drinks which have high sugar content, are said to be a main contributor to obesity, heart disease and other health problems.

With a population of 28m and a prevalence rate of 15%, it is estimated that, currently, there are 4.2m diabetics in Malaysia. In addition, the prevalence of diabetes in the country is expected to continue to climb at an increased rate, due to the typical Malaysian diet and lifestyle.

CAP pointed out that Norway already has an excise tax on refined sugar products, including soft drinks, while Hungary and Finland have introduced taxes on both soft drinks and other high-sugar foods. Furthermore, the French government approved a tax on colas and other sweetened beverages early this year, and various US states have also implemented or proposed such taxes.

It was concluded that the significant increase in diabetes in Malaysia needs strong measures by the government. In particular, Malaysia has a sugar subsidy which encourages sugar consumption, and which must be removed at the same time as the soda tax is imposed. Other unhealthy foods that contain high fats, sugar, salt and additives should also be discouraged by the introduction of taxes on them, the CAP said.

TAGS: tax | public health | excise duty | food | Malaysia

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