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Proposed Ontario Food Tax is Quack Economics and Bad Fiscal Medicine

Author: 2012/10/23

OTTAWA, ON: The Canadian Taxpayers Federation (CTF) sharply criticized the suggestion of new Ontario taxes on food containing quantities of sugar and fat deemed excessive, as proposed in a news release today from the Ontario Medical Association.

 “These new taxes amount to quack economics,” said Gregory Thomas, CTF Ontario Director. “There are no clinical trials, no peer-reviewed papers, no real-world examples where food taxes have produced a measurable effect on consumer behaviour, on nutrition, or on health outcomes for the population.”

 “If Ontario doctors want to practice economics, they should uphold the same standards of scientific rigour they insist on in their own profession,” Thomas continued.

Thomas cited a 2009 study by the Mercatus Centre of George Mason University which found that a 20 per cent tax on a 75-cent soft drink (upping the price to 90 cents) would see the Body Mass Index (BMI) of an obese person decline from 40 to 39.98, a virtually non-existent decline. A 2004 Statistics Canada survey shows that soft drinks represent only 2.5 per cent of caloric intake for the average Canadian.

Thomas said the food tax introduced in Denmark in 2011 has resulted in disastrous economic outcomes, including job losses and cross-border food shopping in Germany, while delivering no correspondingly positive measurable health outcomes.

“Special taxes on food hurt everyone,” said Thomas. “Food taxes hurt marathoners who enjoy sports drinks, and they hurt single parents who treat their kids to Coke and a bag of chips once in a while. Food taxes don’t address the root causes of obesity and bad nutrition.”


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