ISLAMABAD: The Pakistan National Heart Association (Panah) has written a letter to Prime Minister Shehbaz Sharif urging him to increase tax on sweetened beverages and related products.

It has sought an increase in the Federal Excise Duty (FED) to 50pc on all sugary drinks, including juices, sodas, syrups, coffees, squashes, energy drinks, flavoured milk and iced teas.

It is worth mentioning that as the budget for the financial year 2024-25 is being finalised, health activists have been demanding an increase in the tax on sugar and tobacco products. On the other hand, industries have been making efforts to reduce the percentage of proposed taxes on such products.

The letter, signed by Panah President Dr Masudur Rehman Kiani, stated that his organisation was formed in 1984 at the Armed Forces Institute of Cardiology (AFIC) under the patronage of the “president” of Pakistan at the time. Since then, it has been working to reduce non-communicable diseases (NCDs) in Pakistan.

Body claims these beverages increase diabetes risk by 30pc

“I am writing you to express our deep concern over the recent tactics by juice and beverage companies for reductions of tax in the upcoming budget. We urge the government to reject such efforts and maintain the commendable advancements made in fiscal policies aimed at improving public health over the past year,” the letter copies of which have been sent to ministers of finance, health, trade and commerce, and the chairman of the Federal Board of Revenue (FBR) stated.

“Our concern stems from the deceptive efforts of the fruit juice industry, which includes a misleading media campaign and lobbying efforts... The regular consumption of sugary drinks, including juices, poses significant health risks, particularly among children. This trend not only threatens public health but also imposes a substantial negative impact on the national economy,” it stated.

Dr Kiani said that recent medical research indicated that juices were as high in sugar as other sugary beverages, contributing to the rising incidences of obesity, type-2 diabetes, heart diseases, various cancers, and liver and kidney ailments.

“The International Diabetes Federation (IDF) estimated that Pakistan has over 33 million people living with diabetes, the highest prevalence globally. This number is set to be 62 million by 2045 if no immediate policy action is taken by the government. Over 1,100 individuals die daily from diabetes and its complications. In 2021, the annual cost of managing diabetes in Pakistan was $2.64 billion (Rs712 billion). The evidence shows that consumption of sugary drinks and juices increases the risk of diabetes by 30 per cent,” he stated.

“World Bank modelling study in 2022 highlights that increasing the Federal Excise Duty (FED) on sugary drinks juices in Pakistan would significantly improve public health outcomes by preventing overweight/obesity, diabetes, stroke, cancer and cardiovascular diseases. The study estimates that a 50pc increase in FED on all sugary drinks will bring health gain of 8500 DALYs [disability-adjusted life years], an economic value of $8.9 million to Public health by reducing hospital expenditure and could generate $810 million in revenue annually over the next decade,” he said.

It is worth mentioning that a DALY is the sum of years of potential life lost due to premature death and the years of productive life lost due to disability compared to a standardised life expectancy.

“Research consistently shows that taxing sugary drinks does not harm the economy or employment in countries where such measures have been implemented. Studies from Mexico, South Africa, and Peru demonstrate that taxing sugary drinks reduces the consumption of unhealthy beverages and promotes healthier alternatives such as water and unsweetened milk. In fact, increased taxes on sugar-sweetened beverages is a triple win benefitting the government by boosting revenue, reducing health-related expenditures and there is no cost associated with implementation of this policy,” he said.

“Given these facts, we urge you to intervene and consider increasing FED to 50 per cent on all types of sugary drinks,” he added.

According to the letter, a “national opinion poll” conducted by the Pakistan Health Research Council in 2021 indicated that “80 per cent of people support” the measures to reduce the consumption of sugary drinks whereas “78 per cent support” the increase in taxes on such drinks.

Panah General Secretary Sanaullah Ghuman told Dawn that Pakistan had comparatively low taxes on sugary drinks in the region with 20 per cent FED and 18 per cent sales tax.

“In Saudi Arabia, Qatar, Oman, UAE and other gulf countries, 50 per cent excise on sugary drinks and 100 per cent on energy drinks is imposed. In India, the total tax on such drinks is 40 per cent and Maldives has a levy of $2.25 per litre of sweetened beverage,” he claimed.

Published in Dawn, May 20th, 2024