In September, the province will become the first in Canada to introduce a special tax on sugary drinks, raising a projected annual revenue of $9 million.
At the historic Caines Grocery & Deli in St. John’s, customer Cecil Parsons said life is already too expensive. “I’m not going to keep buying it if it’s like a fortune to buy a pop, like gasoline.”
The new tax, which will take effect on September 1, will apply an additional twenty cents per liter to a wide range of products, including regular soft drinks and those with added sugar, such as fruit juices, iced tea and lemonades, along with sweetened sports drinks. . and energy drinks, and some frozen fruit punches.
Caines owner David Howell said getting out of the pandemic slowdown was already difficult. In general, he is optimistic that a good tourist season will help him recover, but, with inflation Since it makes everyday life a desperate struggle for some, he fears another price hike.
“Low-income people are mainly the ones who, they say, buy these things. And, they will be hit again. And, small businesses like me, how much more do we have to incur before the government realizes that we are sufficiently taxed as they are?”
The government says the new tax is about encouraging better habits. From a public health standpoint, it’s getting much more positive reviews.
“We support the government in prioritizing the health of its citizens and we hope that other jurisdictions will take note and follow suit,” said Ann Besner, manager of research and public policy for Diabetes Canada.
While not an additional tax, British Columbia also took action, in 2021, by removing a provincial sales tax exemption for carbonated beverages containing sugar. Besner said it’s important for all provinces and territories to recognize that “these beverages contribute to Canadians’ overall sugar consumption, and sugar can increase the risk of developing chronic diseases such as diabetes.”
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Diabetes Canada says the tax could help reverse the continuing rise of the disease. A recent report showed that nearly 12 million Canadians have diabetes or are at risk of developing it, restricting their lives and putting increasing pressure on overburdened health care systems.
Newfoundland and Labrador’s diabetes rate is especially high, something the province’s doctor turned prime minister, Andrew Furey, is keen to fix.
But critics say the timing is not right. In the Newfoundland and Labrador House of Assembly, members of the Progressive Conservatives and New Democrats insist the government should not take more money out of people’s pockets and have doggedly called on the Liberal government to postpone the sugar tax.
The government refuses to back down. In a typical exchange, on May 18, Finance Minister Siobhan Coady told the camera: “There are choices when you choose to have a drink. You can drink one loaded with sugar or you can drink one without sugar.”
To complicate matters, there is evidence in parts of the world that taxes on Sugary drinks they do not always have the desired effect. Food researcher Sylvain Charlebois of Dalhousie University cited a study of sugar taxes in France and Hungary, suggesting that many people get their sugar fix elsewhere.
“Most public health experts will desperately want to believe in the effectiveness of a sin tax on food, but the evidence is pretty weak at best.”
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