SYLLABUS
GS2: Important International institutions, agencies and fora- their structure, mandate.
Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources.
Context: The WHO’s 2025 Global Report on Sugar-Sweetened Beverage Taxes finds that although over half of countries tax sugar-sweetened beverages (SSBs), the average tax is just 6.8% of the retail price.
More on the News:
• Releasing two papers, the WHO has called on countries to raise and redesign taxes as part of its new 3 by 35 initiatives to reduce consumption and improve health outcomes.
• The WHO report notes that at least 167 countries tax alcoholic beverages and 12 ban alcohol altogether, yet alcohol has become more affordable.
• The assessment is based on WHO data compiled for the second time since the report was first published in 2023.
Key Findings of the Report
• Leading sources of sugars: Sugary drinks including sodas, ready-to-drink teas/coffees, sweetened milks, energy drinks and fruit juices.
• Tax Coverage Gaps: The reports show that at least 116 countries tax sugary drinks, many of which are sodas.
- But many other high-sugar products, such as 100% fruit juices, sweetened milk drinks, and ready-to-drink coffees and teas, escape taxation.
• Energy Drink Taxes at a Standstill: Although 97% of countries tax energy drinks, this proportion has stayed the same since the 2023 global report.
• Poor Alcohol Taxation: Tax shares on alcohol remain low with global excise share medians of 14% for beer and 22.5% for spirits, indicating limited fiscal pressure on alcohol consumption.
- Wine remains untaxed in at least 25 countries, mostly in Europe, despite clear health risks.
• Regional Inequities: As per study by nonprofit Center for Science, Multinational and local producers of sugar-sweetened beverages are investing heavily in low- and middle-income countries in the wake of declining sales in wealthy countries.
• Inadequate Health Allocation of Tax Revenue: Of the 116 countries that apply excise taxes on non-alcoholic beverages, only 10 countries dedicate the revenue specifically to health programmes.
• Regional Consumption Pattern: The highest consumption rates were observed in Colombia, in contrast, countries like India, China and Bangladesh recorded the lowest consumption.
- This is in contrast with the 2019 findings of The Lancet, which found India is second among the top five global markets for sugary beverage manufacturers.
Health Impact of Sugary drinks and Alcohol:
• Low Nutritional Value: Sugary drinks are quickly digested, causing blood sugar spikes and providing little or no nutritional value.
• Rise in Noncommunicable Diseases: Diets high in sugary beverages, often combined with foods rich in salt and saturated fats, are a major driver of obesity and diet-related noncommunicable diseases, including type 2 diabetes and heart disease.
- In the year 2020 alone, sugary drinks contributed to 2.2 million new cases of type 2 diabetes and 1.2 million new cases of cardiovascular disease.
• Impact on children and adolescents: Rising obesity rates among Indian children, fuelled by aggressive marketing of sugary beverages, are contributing to early-onset diabetes and metabolic disorders.
• Aggravating Cancer Risk: Alcohol consumption is a well-established risk factor for multiple cancers, including oral, oesophageal, liver, colorectal and breast cancers.
Recommendations of the report:
• Raise and Redesign Health taxes: WHO Director-General noted that Increasing taxes on products like tobacco, sugary drinks and alcohol, can help governments reduce harmful consumption and unlock funds for vital health services.
- Countries with higher, well-designed sugar taxes have shown reduced sugar consumption and public health gains. E.g. UK’s sugar levy.
• Promote Healthy Alternatives: The consumption of healthy substitutes such as water should be incentivised and not taxed.
• Inflation Adjusted taxation System: Sugary drink taxes should be regularly updated to reflect inflation, ensuring prices remain high enough to discourage consumption over time.
India’s Taxation regime for Sugary Drinks
• GST “Sin Tax” Framework: At the 56th GST Council meeting held in September 2025, cold drinks, flavored sodas, iced tea, and energy drinks were officially classified as “sin” goods alongside tobacco and alcohol, attracting a 40% GST.
• Eat Right India (ERI) Initiative: Launched by the Food Safety and Standards Authority of India (FSSAI) to improve dietary habits, reduce intake of harmful food components (like excess sugar), and promote safe, healthy and sustainable food choices.
- Campaigns like Aaj Se Thoda Kam (cut sugar, salt, oil) are part of dietary improvement (ERI).
• National Health Policy (2017): Provides the policy backing and justification for higher taxes on sugary drinks, alcohol and tobacco.
• FSSAI Labelling Regulations: Mandatory nutrition labels (sugar content disclosure) and warning labels to aware consumers.