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Fresh Takes

The Fiscal Paternalism of Taxing Sugary Drinks

Many people seem to believe government should take on the role of a father, protecting us from ourselves.

The idea of taxing sugary beverages is in line with this thinking. According to its proponents, Quebecers are oblivious to the harmful health effects of consuming too much sugar, and the government should therefore tax them in order to influence their choices.

“A tax on sugary drinks represents, by its very design, a regressive tax.” That’s what the Institut national de santé publique du Québec had to say on the matter as part of an ethical analysis.

This makes sense, given that food budgets generally represent a higher portion of income for the less fortunate than for the wealthy. Added to this is the fact that any tax representing a fixed amount—for example, 20 cents per litre in Newfoundland and Labrador—will have a greater impact on an income of $30,000 than on an income of $100,000.

The other thing is that while such a tax may reduce the consumption of the taxed goods, it does not necessarily reduce the consumption of sugar. Many substitute goods exist, and someone who wants to indulge their sweet tooth can easily trade a can of soft drink for a chocolate bar in order to avoid the tax.

Ultimately, we need to see these notions of behavioural taxes for what they really are: an attempt by some to protect those they consider too irresponsible to look after themselves. This fiscal paternalism is not a good thing, and it deserves to be denounced.

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