Purchases of taxed beverages decline in Mexico after excise tax takes effect

*** This post has been updated. See additional content here. ***

The UNC Food Research Program at the Carolina Population Center at the University of North Carolina and the Instituto Nacional de Salud Pública have estimated changes in household purchases of beverages over the complete year of 2014, since the one peso per liter excise tax on sugar-sweetened beverages took effect (January 1, 2014).The tax of approximately 10 percent applies to nondairy and non-alcoholic beverages with added sugar.

The data comes from a commercial panel of consumers that contains information on purchases of beverages from households living in 53 cities with at least 50,000 residents. The model adjusts for the pre-existing downward trend of taxed beverages since 2012 and for macroeconomic variables that can affect purchases. Preliminary results show a 6 percent average decline in purchases of taxed beverages over 2014 compared to pre-tax trends. This difference accelerated over 2014 and the reduction compared to pre-tax trends reached 12% by December 2014. All socioeconomic groups reduced purchases of taxed beverages. Reductions were higher among lower socio-economic households, averaging 9% decline over 2014 compared to pre-tax trends and up to a 17% decline by Dec 2014. Results also show roughly a 4 percent increase in purchases of untaxed beverages over 2014, mainly driven by an increase in purchased bottled plain water (tap water intake is not collected).

These preliminary results show average effects in the population studied. Future research would provide estimations on subgroups (i.e. large consumers of taxed beverages) to assess differential effects.

These results are preliminary and are currently under peer-reviewed publication. ***update*** The results of the study have been published in The BMJ in January 2016. Read more about the study and final results here, or download the PDF here. The study is funded by Bloomberg Philanthropies and the Robert Wood Johnson Foundation.

The research team included M. Arantxa Colchero and Juan A. Rivera, Instituto Nacional de Salud Pública INSP and Barry M. Popkin and Shu Wen Ng, University of North Carolina.

Ver en español aquí

Read media coverage in International Business Times here

About Bridget Hollingsworth

Carolina Population Center
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