Sugar, Salt, and Fat Taxes Could Save Australia $3.4 Billion

Salt and sugar taxes have received equal amounts of support and criticism in Australia, but a new study reveals the potential benefits such taxes may bring.

Research from the University of Melbourne has revealed that having taxes on sugar, salt, and saturated fat, as well as subsidies for fresh fruits and vegetables, could help Australia’s health budget to the tune of $3.4 billion.

The research modelled the effect of a combined tax and subsidy package that adds less than 1% to the average household’s weekly food and drink expenditure.

The study reported that this combination of taxes and subsidy would add 2.1 years of healthy life for every 100 Australians.

What would the taxes actually look like?

The Centre for Health Policy’s report was based on 2010 populations, and the following parameters and assumptions:

  • Cost of implementing the taxes: $22 million
  • $1.37 for every 100 grams of saturated fat (excluding milk)
  • $0.30 per 1 gram of sodium (excluding fresh fruit, vegetables, meats and dairy)
  • $0.47 per litre for sugary drinks
  • $0.94 per 100 millilitres for ice cream
  • $0.85 per 100 grams of sugar in other products (excluding fresh fruit, vegetables, and dairy)
  • Subsidies of $0.14 per 100 grams of fruit and vegetables

Will the taxes be implemented?

In the near future, this is unlikely.

Despite the fact the countries including Britain, Ireland, France, and Mexico have already put similar taxes in place, the current government is opposed to such measures. Deputy Prime Minister Barnaby Joyce describes the idea of a sugar tax as “bonkers mad”, citing concern for the Queensland and NSW sugar industries.



The University of Melbourne report even noted that “the food industry is unlikely to welcome policies that steer consumption away from profitable, processed foods”.

The report acknowledged that large companies or corporations can use their financial power to promote information that “distracts and confuses the public”, as well as influencing research and lobby politicians.

However, recent years have seen a groundswell of support for taxes on unhealthy food, coupled with several studies suggesting the merits of said taxes.

The Federal Greens have added a 20% tax on sugary drinks to their platform, which received support from the National Heart Foundation and the Australian Medical Association.

November of last year saw the Grattan Institute release a report recommending a tax on sugary drinks to the tune of 40 cents per 100 grams of sugar. The study cited the $5.3 billion that obesity costs taxpayers annually, and the fact that while soft drinks are not solely responsible for Australia’s obesity issue, they “should be targeted because they have no nutritional value, and children are big consumers”.



However, Deputy Prime Minister Barnaby Joyce offered a slightly more simplistic solution to obesity rates at the time, saying, “If you want to deal with being overweight – well, here is a rough suggestion – stop eating so much and do a bit of exercise.”

Share this article