The health of Colombians should be a priority when thinking about tax reform.
Sugary drinks are under the eye of the hurricane after the controversial tax reform proposed by the Colombian government. Photo: Pexels
LatinAmerican Post | Vanesa López Romero
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Leer en español: Opinión: ¿Las bebidas azucaradas son dañinas para la salud?
We continue to hear on the news those two terrifying words "sugary drinks". Still, for lunch, soda is not bad. Once a year does not hurt, some will say.
With the Tax Reform of the current government in Colombia, the issue has flared up again, especially because for Alberto Carrasquilla, current Minister of Finance of Colombia, and for the current government, it makes sense that the 19% VAT is applied to public services and funeral services but not to sugary drinks or to religious centers. Two things should be highlighted: first, sugary drinks already have VAT since 2018, but it is a multi-phase VAT, which means that suppliers, wholesalers, distributors and those merchants who sell more than $ 2.4 billion a year, must declare and pay VAT . Second, as a result of the national strike that has taken place since April 28 in the country, Iván Duque, president of Colombia, affirmed that he expects a consensus around the Solidarity Law so that VAT is not applied to food and public services. However, this has not been confirmed.
The debate that has been generated is that with the tax reform a surcharge would not be applied to sugary drinks, but 19% VAT would be applied to tap water, as journalist Felix de Bedout. correctly stated.
Sobretasa a las bebidas azucaradas, no.— Félix de Bedout (@fdbedout) April 16, 2021
IVA del 19% para el agua de la llave, sí.
Prioridades de la #ReformaTributaria del gobierno de @IvanDuque.
*Trino actualizado, atendiendo observaciones sobre el tema del IVA.
According to Juan Carlos Echeverry, ex-finance minister, "foreign evidence shows that the tax on sugary drinks is unsuccessful" because in Denmark taxes on sugary drinks were implemented to avoid health problems and obesity in its citizens. He says that: " a year later, the center-left government abolished it due to the immense administrative difficulties: price increases, demand for imports, the exit of companies and the loss of jobs ”.
However, the excuses with which the government has come up with are insufficient. Carrasquilla says that "We did not include it but we are aware that this will enter the discussion in Congress. The president has skepticism about the effectiveness of this tax, I am not sure that this tax has the effects on externalities on the health of citizens, but we are ready for that debate. "
But the scientific evidence shows just the opposite.
Why are sugary drinks bad for your health?
According to the Boston Public Health Commission, one of the consequences of drinking sugary drinks is weight gain and increased risk of type 2 diabetes, heart disease, obesity and gout. Also, "women who drink one or more sugary drinks every day almost double the risk of developing diabetes as those who drink less than one sugary drink a day", while "the risk of a child being obese increases by 60 % with each additional sugary drink consumed daily. "
This not only implies then that perhaps only the health of citizens is affected, but that in the long run this has an impact on a health system that, from what we already know and see, does not have enough capacity to support the Colombians in a decent state of health. A health system that, of course, will not profit from the surcharge that could have been applied to sugary drinks.
So, it is worth asking ourselves if the excuses with which our political authorities come out are legitimate, or if they are just typical lobbyism.