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Impact of a tax on highly processed foods on manufacturers
Idaho

Impact of a tax on highly processed foods on manufacturers

According to a recent survey of British consumers, most Britons want a tax on junk food and ultra-processed food producers because they believe it would help combat the obesity crisis.

In the UK, there is apparently a growing hatred of UPF: in a survey by the Health Foundation, almost two thirds (62%) of them said that advertising for unhealthy food before 9pm on television and the internet should be banned. In addition, 53% are calling for a tax on UPF manufacturers.

But it’s not just the British. Consumers in the EU are also demonising UPFs: 67% believe they contribute to the rise in obesity and other health problems, according to a recent survey by the EIT Food Consumer Observatory.

EU citizens’ trust in UPFs is also generally lower: 40 percent of respondents say the industry is not sufficiently regulated and 67 percent dislike it when their food contains unrecognisable ingredients.

So if such a tax were introduced, what impact would it have on manufacturers? And would it help slim down consumers’ waistlines?

Who would monitor a UPF tax?

Implementing a UPF tax would be difficult to manage and would probably not address consumer concerns, said Danny Butt, director of consultancy Food Innovation Solutions. “On a macro level, it could be a tax similar to the sugar tax (in the UK), so if it’s modeled on that, it creates a situation where some brands have to cut costs or absorb (the tax).”

However, the increased cost of living has already led to product price increases, while retailers are also reluctant to pass on additional costs to customers. “However, the impact would be brand-specific. A company like Coca-Cola could increase its prices because it is the market leader, but private labels and smaller companies would not be able to absorb this,” he continues.

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