Grattan Institute's Case for Sugar Tax Is Not Proven
Australian Economic Review, 2018, vol. 51, issue 1, 41-51
Duckett, Swerissen and Wiltshire () advocated a 40â€ cent tax per 100g of sugar in sugarâ€ sweetened beverages (SSB), because the tax would reduce the cost burden on the nonâ€ obese. Duckett, Swerissen and Wiltshire took these â€˜thirdâ€ partyâ€™ costs as indices of market failure. However, their distributional analysis is not an appropriate framework for the assessment of economic efficiency. Moreover, they did not quantify the causal mechanisms through which a small weight loss would appreciably lower health costs and increase employment of the obese. There may be an economic case for such a tax, but Duckett, Swerissen and Wiltshire have not made it.
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