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Study question What has been the effect on purchases of beverages from stores in Mexico one year after implementation of the excise tax on sugar sweetened beverages?
Methods In this observational study the authors used data on the purchase of beverages in Mexico from January 2012 to December 2014 from an unbalanced panel of 6253 households providing 205 112 observations in 53 cities with more than 50 000 inhabitants. To test whether the post-tax trend in purchases was significantly different from the pretax trend, the authors used a difference in difference fixed effects model, which adjusts for both macroeconomic variables that can affect the purchase of beverages over time, and pre-existing trends. The variables used in the analysis included demographic information on household composition (age and sex of household members) and socioeconomic status (low, middle, and high). The authors compared the predicted volumes (mL/capita/day) of taxed and untaxed beverages purchased in 2014—the observed post-tax period—with the estimated volumes that would have been purchased if the tax had not been implemented (counterfactual) based on pretax trends.
Study answer and limitations Relative to the counterfactual in 2014, purchases of taxed beverages decreased by an average of 6% (−12 mL/capita/day), and decreased at an increasing rate up to a 12% decline by December 2014. All three socioeconomic groups reduced purchases of taxed beverages, but reductions were higher among the households of low socioeconomic status, averaging a 9% decline during 2014, and up to a 17% decrease by December 2014 compared with pretax trends. Purchases of untaxed beverages were 4% (36 mL/capita/day) higher than the counterfactual, mainly driven by an increase in purchases of bottled plain water.
What this study adds The tax on sugar sweetened beverages was associated with reductions in purchases of taxed beverages and increases in purchases of untaxed beverages. Continued monitoring is needed to understand purchases longer term, potential substitutions, and health implications.
Funding, competing interests, data sharing This work was supported by grants from Bloomberg Philanthropies and the Robert Wood Johnson Foundation and by the Instituto Nacional de Salud Pública and the Carolina Population Center. The authors have no competing interests. No additional data are available.
Myriad studies suggest that added sugar in beverages is linked with obesity and many cardiometabolic problems and have recommended that efforts to reduce consumption of sugar sweetened beverages to obtain meaningful improvement to health would require a tax that leads to price increases.1 2 3 4 5 6 7 Aside from industry funded studies, the consensus from a large literature of randomized controlled trials,8 longitudinal cohort studies, and smaller clinical studies is that humans do not reduce food intake when consuming caloric beverages. The lack of dietary compensation is hypothesized to be due to form (liquid versus solid), beverage type (for example, carbohydrate content, fat content), and resultant release of hormones such as ghrelin and insulin.9 Therefore, reducing the intake of sugar sweetened beverages could reduce body weight and many cardiometabolic problems.5 10 11 12
The likelihood of obesity among Mexicans of all ages is high.13 14 The prevalence of overweight and obesity is more than 33% for young people aged 2-18 years (about the same across all age groups) and around 70% for adults (half of whom are obese).15 16 17 The prevalence of diabetes in Mexico (based on hospital admissions) is the highest among the Organization for Economic Cooperation and Development countries,18 and ischemic heart disease and diabetes are the two leading causes of mortality in Mexico.19 Additionally, the prevalence of overweight and obesity increased by 12% between 2000 and 2006 and reached 72% among adults in 2012.14 Concomitant with the rise in obesity and diabetes in Mexico are large increases in the consumption of sugar sweetened beverages20 21–Mexico had the largest per capita (163 liters) intake of soft drinks in 2011. Several studies showed that before the debate over this tax the intake of sugar sweetened beverages was rapidly increasing in Mexico.20 21 22 Reducing such consumption has been an important target for obesity and diabetes prevention.23 24 A Ministry of Health beverage guidance panel had proposed a tax years earlier and it was endorsed, among others, by many medical societies.24
In September 2013, as part of the federal budget, the Mexican congress passed an excise tax on sugar sweetened beverages and a sales tax on several highly energy dense foods.25 A specific excise tax of 1 peso/L (approximately a 10% price increase based on 2013 prices) on non-dairy and non-alcoholic beverages with added sugar and an ad valorem tax of 8% on a defined list of non-essential highly energy dense foods (containing ≥275 calories (1151 kJ) per 100 g) came into effect on 1 January 2014. Agencies collect the excise tax on sugar sweetened beverages from the manufacturers, and other research indicates that this tax is entirely passed on to consumers at the point of sale. Prices of sugar sweetened beverages increased on average by 1 peso/L in 2014 (exactly the amount of the tax), and these changes in prices, which began in the tax’s first month, were observed throughout the year.26 27 Using scanned and recorded food purchase data from a representative group of Mexican households in cities with more than 50 000 residents from January 2012 through December 2014, we evaluated changes in the purchases of consumer beverages after the implementation of the excise tax.
We obtained data on purchases from January 2012 through December 2014 from Nielsen Mexico’s Consumer Panel Services, which is equivalent to the data from the US Nielsen Homescan panel.28 In the US, Nielsen Homescan data have been used in several studies, including some that have linked purchases to data on nutrition labels to determine the caloric content of purchases and to evaluate industry efforts.29 30 However, linking purchases to nutrition data is currently not possible in Mexico owing to the lack of comprehensive data sources related to labeling. Therefore we focused on changes in the volumes of beverages purchased.
Each year the Nielsen Mexico Consumer Panel Services samples Mexican households in 53 cities (in 28 states plus Mexico City) with more than 50 000 inhabitants. Based on government statistics, this sample represents 63% of the Mexican population and 75% of food and beverage expenditures in 2014.
