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Portugal To Tax Sugary Drinks

by Ulrika Lomas, Tax-News.com, Brussels

18 October 2016


The Portuguese Government has said that it intends to introduce a tax based on the sugar content of drinks to tackle obesity and other health problems related to the consumption of sugar.

Under the plans, drinks with a sugar concentration in excess of 80g per liter will be taxed at a rate of EUR16.44 (USD18) per hectoliter. Drinks with a sugar concentration below 80g per liter will attract a lighter tax of EUR8.22 per hectoliter. However, drinks based on fruit juices and milk would be exempt from the tax.

It is predicted that the tax will add about EUR0.055 to the price of a 330ml can of soft drink and raise around EUR80m in additional revenue for the Government.

The announcement by the Portuguese Government comes just days after the publication of a World Health Organisation (WHO) report into the taxation of unhealthy foodstuffs, which concluded that taxing sugary drinks can lead to lower consumption and help to reduce obesity, type-two diabetes, and tooth decay.

The WHO argued that fiscal policies that lead to at least a 20 percent increase in the retail price of sugary drinks would result in proportional reductions in consumption.

TAGS: tax | Portugal | public health | food | retail

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