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SHAPING THE OVERWEIGHT & OBESITY BURDEN IN VIETNAM: IMPACTS OF SUGAR-SWEETENED BEVERAGE TAX

Nguyen Thuy Duyen1,2 , Hoang Van Minh1, Dao The Son3

1Queen’s University Belfast (UK); 2Hanoi University of Public Health; 3Thuongmai University

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CONTENT

  1. Context
  2. Model design & tax scenarios
  3. Main findings
  4. Discussion

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Context

  • Resolution No. 20-NQ/TW of the 7th Central Committee of Communist Party
  • National Strategy on Nutrition during 2021-2030 with a vision to 2045
  • National Plan for Prevention and Control of NCDs and Mental Health Disorders 2022-2025
  • Draft Law of Special Consumption Tax in 2017 by Ministry of Finance:

a 10% ad valorem tax on sugar-sweetened beverages in Vietnam. SSB products include carbonated soft drink, non-carbonate soft drink, energy drink, sport drink, ready-to-drink tea/ coffee, except 100% juices, milk and milk-based drinks.

Sources: 1 - Vietnam National Nutrition Survey 2019-2020 (MOH); 2 – Vietnam STEP survey 2015 (MOH); 3 –Soft drink in Vietnam (Euromonitor, 2018); 4 – Taxes on Sugar-Sweetened Beverages: International Evidence and Experiences (World Bank, 2021)

Sugar-sweetened beverages taxes in 56+ countries/ territories

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OBJECTIVES

Estimating the impacts of different tax plans of sugar-sweetened beverage tax on the burden of non-communicable diseases in Vietnam

Literature review

Methodological review on simulation models of SSB tax

International experiences in designing & adopting SSB tax

Simulation model

Design of tax scenarios

Model adoption & analysis

Policy recommendations for

SSB tax in Vietnam

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Model structure

STEP 1: GlobalData 2020; price elasticity of -1.14 1

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STEP 2

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STEP 3: using cohort data from STEP 2015

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STEP 4

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SSB tax

Increase SSB retail price

Change in SSB consumption

Change in sugar consumed from SSB

Change in total energy intake

Change in body weight

Reduce overweight & obesity prevalence

Reduce burden of diabetes type 2

# cases avoided

Health cost saved 2

∆ energy balance

= ∆ energy intake from SSB

Calorie-to-weight conversion factor 3

↓ 94kJ/day in 3 years = ↓ ~1kg

Sources: (1) Linh Luong et al 2019 (LINK); (2) Pham Kiet et al 2020 (LINK); (3) Swinburn et al 2009 (LINK)

Risk reduction of 27% for each 2 BMI units decrease

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Potential tax scenarios modelled in this study

Source: Shared data from SSB tax simulation model (a joint work by Health Bridge Canada in Vietnam and WHO, 2020)

Sugar-based specific tax

Volume-based specific tax

Ad valorem tax

Comparison by price increase levels

Comparison by� different tax designs

5%

11%

19-20%

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MAIN FINDINGS

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Price increase by SSB categories

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Sugar density (per 100ml)

Carbonated: 11 gr

Veg/fruit juices: 7 gr

RTD tea/coffee: 9 gr

Sport/Energy drinks: 16 gr

1 gram sugar = 4 kcal

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Sugar density (per 100ml)

Carbonated: 11 gr

Veg/fruit juices: 7 gr

RTD tea/coffee: 9 gr

Sport/Energy drinks: 16 gr

1 gram sugar = 4 kcal

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Weight changes

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Prevalence of overweight, obesity & diabetes type 2

Price increase 5%

Price increase 19%

Price increase 11%

Price increase 20%

Price increase 20%

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Prevalence of overweight & obesity by rural/urban

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Saving in healthcare cost & Raise in revenue

Total revenue gain 5,300 bil VND 9,340 bil VND 15,970 bil VND 16,350 bil VND 17,350 bil VND

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Discussion

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DISCUSSION

  • Level of price increase:
    • The impacts on consumption and heath burden grow linearly with price increase level.
    • While the scenario of 5% price increase would merely make a difference, 20% price increase would show more sizable reduction in obesity-related disease burden.
  • Tax design:
    • Specific tax based on sugar content is favored, if compared at the same price level.
    • This tax design is preferable for targeted high-sugar SSB products but also appraised for incentivizing industry to reformulation SSB products to have less sugar.

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International experiences

  • Mexico

Nguồn: Mexico, Anh, California, Philadelphia

Mexico: 1 peso/litre = price increase 11%) in 1/1/2014

    • Reduce SSB consumptions by 5.5% in 1st year and 9.7% in 2nd year
    • The low SES groups had the biggest decline in SSB purchases

Anh: two tiers sugar –based tax enacted in 2018

    • A shift in market share to sugar-free/less-sugar/diet drinks
    • Average sugar contain in beverages reduced by 43.7%
    • Average amount of sugar consumption from SSBs reduced by 35.4%

California (2015) & Philadelphia (2017)

    • California: SSB purchases decreased by 21% in the 1st year and remained for 3 years
    • Philadelphia: amount of sugar consumed from SSBs reduced by 6 grams/day

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DISCUSSION

  • The study findings is consistent with previous simulation studies in the world.
  • The higher tax rate is, the greater health benefit would be achieved.
  • Well-design sugar-based tax design is highly recommended for its potential to incentivize the product reformulation.
  • Overall, SSB tax could eventually reduce the SSB consumption & amount of sugar consumed from SSB in daily diet. Hence, SSB tax policy could greatly alter the increasing trend of overweight & obesity and the burden of obesity-related-NCDs.

🡪 Highly recommended to introduce SSB tax to reduce, or at least hinder, the raise burden of obesity-related diseases in Vietnam

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LIMITATIONS & CONSIDERATIONS

  • Projected results was carried out for adult population aged 18-69 only and cannot estimate distributional impacts by different SES groups or SSB targeted consumers
  • The potential benefits could be much greater if other chronic diseases such as cancer, cardiovascular diseases, hypertension, etc were accounted in model design.
  • Considerations for the inclusion of artificial sweetener in the scope of taxed SSB products
    • Aspartame - a table-top sweetener in diet drinks – is currently under evaluated by WHO/IARC as a possibly carcinogenic to human
    • https://monographs.iarc.who.int/iarc-monographs-volume-134/

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BETTER RUN NOW BEFORE IT IS TOO LATE!

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