Using taxes to beat NCDs: success story in Hungary
WHO
Use of taxation as a means to prevent NCDs and to finance national responses will be one of the topics for discussion at the Conference, among other proven interventions to address the growing burden of NCDs. An increasing number of countries in the WHO European Region have been adopting this approach, with excellent results.
Hungary is a prime example of how implementing targeted taxes can contribute to beating NCDs. In 2011 the country introduced a public health product tax (PHPT), aiming to “reduce the consumption of food products that are not useful from a public health point of view and to promote a healthy diet”. The PHPT targeted eight different product groups, including sugar-sweetened cocoa powder, energy drinks, condiments, fruit jams, flavoured beer and alcoholic beverages, salty snacks, soft drinks and syrups.
An assessment of the impact of the PHPT was conducted four years after its introduction and clearly showed not only that consumption of the taxed products had decreased but also that the reduction had generally been maintained. The evaluation revealed that most consumers (59–73%) reduced their consumption of the targeted products. Of these, more than two thirds went on to choose a healthier alternative, of which the most frequent were mineral water, fresh fruit and vegetables, home-made sweets and green herbs and spices.
The evaluation also showed that the groups most at risk – namely adults with overweight or obesity issues – were approximately twice as likely to change their consumption than adults who were underweight or of normal weight. This is an important achievement in a country where two thirds of adults experience such issues.
From a Hungarian perspective, the conclusion is clear: taxing products high in saturated fats, trans fats, sugar and salt achieved its objectives in both the short and the long term.
Using the PHPT to finance Hungary’s national response to NCDs
A total of €200 million was generated in tax revenue during the first four years of the PHPT. This made it possible to raise the wages of 95 000 health care workers in Hungary by 25%. The wage increase applied to employees working for health service providers owned by the state, local government bodies, and institutes of higher education.
In addition to recommending that the increased tax revenue be used to raise wages for health care workers, the impact assessment advocated raising awareness of the significance of a healthy diet. Targeted health communication and other policies could be used to extend the impact of the food tax to other population groups, especially those with lower educational levels.
The report also recommended that the government consider price subsidies for healthy food products, such as fruit and vegetables, to make them more viable alternatives to products with a high content of saturated fats, trans fats, sugar and salt.
A country-level response to a global epidemic
By improving the national diet, the risk factors for many NCDs – including diabetes and cardiovascular diseases – are reduced. Countries are increasingly introducing taxes on foods as cost-effective measures to encourage better nutrition among their populations, and the Hungarian experience can serve to inspire and motivate others.
WHO recently issued a report from a technical expert meeting that provided guidance on introducing sugar-sweetened beverage taxes and encouraged countries to consider taxes of around 20%.
Rising to the challenge of achieving the Sustainable Development Goals
“We need commitment and investment from the highest levels of government. Preventing and controlling NCDs is a health issue, it is a financial issue, and it is an educational issue. It cuts across so many areas of life,” said WHO Director-General Dr Tedros Adhanom Ghebreyesus in his video address for the WHO Global Conference on NCDs in Uruguay. He added that taking action against NCDs is key to achieving Sustainable Development Goal 3.4 (by 2030, reduce by one third premature mortality from NCDs through prevention and treatment). “It is a truly unique opportunity for the world to rise to the challenge of NCDs and to meet commitments set by the Sustainable Development Goals.”
