The potential economic impact of a sugar-sweetened beverage tax in Malta

Abstract

The link between adverse health effects and Sugar-Sweetened Beverages (SSBs) is well established. Although several policies have been enacted, Malta still fares extremely poorly in controlling obesity, and this leads to several direct and indirect economic burdens. In this view, this study analyses the potential economic impact of a 20% tax on SSBs. The aim is to establish how such a tax impacts the national overweight and obesity prevalence together with the related economic effects which may arise. Based on the 2015 Maltese population aged 15 years and older, and using data obtained from the 2015 European Health Interview Survey (EHIS), the tax hike was modelled systematically. A sensitivity analysis is also performed. The main results show that a 20% SSB tax in Malta is expected to cause at least some weight loss in around 40% of the population. More importantly, it is expected to negatively impact the overweight and obese population by 2.7% and 2.9% respectively. As a result, this would lead to a positive economic impact of between €2.7 and €3.7 million for 2015.