Cokes and smokes taxes: ‘I don’t care, I’ll still buy it’

‘You could probably improve the way people eat without hitting their pockets’

Irish Times Consumer Affairs Correspondent Conor Pope asks members of the public if new tax increases on sugary drinks and cigarettes will impact them.

 

The trickle of customers who came into Colm’s Shop on Dublin’s Townsend St ahead of the lunchtime rush on Thursday afternoon were conflicted about the sugar tax and the hike in the price of cigarettes but none reckoned either one will lead to people giving up cigarettes or consuming less sugar-sweetened drinks.

As a smoker with a sweet tooth, Teresa Deegan will be hit particularly hard by the twin taxes. She had come in to Colm’s to buy ‘Cokes and Smokes’ and had not heard about either the sugar tax which will add 30 cent on to the price of a one-litre of her favourite tipple from next April or the immediate 50 cent increase in the price of a packet of 20 cigarettes.

There was no chance the duty increase on tobacco will change her habits, she said. “You’re still going to buy it”

When it came to the sugar tax she was equally defiant. “I am buying six cans of Coke for myself. I don’t care, I’ll still buy it. I know it’s not good but you’re never sick when you drink Coke. You’re not. My son drinks Coke, has been for for the last 10 years and he has never been sick.”

The more she thought about the tax the more she warmed to her anti theme. “It’s a bad idea. People are still going to buy it, regardless. I’ll only buy the ordinary Coke, I don’t like the taste of diet Coke. If I am going to die, I am going to die, right?”

Liam Byrne is a smoker and was dismayed by the tax increase on cigarettes. “It hits the working-class person, the working-class person is getting hit with most of the taxes. €12 for a packet of 20 cigarettes? That works out at 70 cent a cigarette. I remember when you could get a looser in the shops for 10p. But if you’re a smoker, you’re a smoker and it’s very hard.”

He agreed with the tax on the sugary drinks “because of the health benefits”. He said he had seen too many soft drink companies deliberately directing their ads at children and expressed concern at the ultimate cost to the taxpayer “when it comes to dental treatment and people becoming addicted to sugar”.

Jace Guzman from Texas was buying a sugar-free drink Pepsi the shop. “I think you could probably improve the way people eat without hitting their pockets,” he said.

Rachel Barry O’Byrne said the “tax on fizzy drinks is controversial” but said it was “good because it will stop the kids buying sure it’s not healthy.”

The tax of tobacco will not, however, stop her smoking. “I’m on a low income so I’ll have to budget because I’m only on the welfare.”

The question that neither those who came into Colm’s or even the Government can answer for sure is whether either tax - or the Tan Tax targeting sunbeds - will see usage fall.

International evidence provides contradictory evidence. In 2011 Denmark rolled out a tax on foods that were high in saturated fat. 12 months later the tax - along with plans for a sugar tax - was scrapped after leading to increased cross-border shopping, higher food prices and no significant consumption decline.

A sugar tax in France introduced a year later has seen consumption fall by over 3 per cent, although it may still be too early to tell if the tax works long term while in Mexico sugary drink consumption went on something of a rollercoaster after a tax was rolled out in 2014.

The industry in Ireland is convinced the tax is a waste of time but Prof Donal O’ Shea, Ireland’s leading obesity expert, has said it was “a hugely important step towards reducing obesity”. He said estimates are “that this measure could reduce obesity rates within five years by thousands of cases per year.”

Time will tell. Perhaps the biggest impact it will have is not on the behaviour of consumers but manufacturers who will move to reformulate their products to reduce the added sugar content so they can sidestep the tax.