Post-Brexit VAT overhaul could slash childhood obesity, says Chief Medic

10 Oct 2019 --- Brexit could present an opportunity to review value-added tax (VAT) rates to rebalance the cost of food and drink in favor of health. This is according to Professor Dame Sally Davies’s final independent report, following the end of her eight-year tenure as Chief Medical Officer for England and Chief Medical Adviser to the UK government. Her report calls on the UK government to take “bold action” to slash children’s obesity rates, which has “cruel and avoidable” health impacts.

“The present high levels of childhood overweight and obesity are like a canary in the mine: a warning sign of a much bigger issue. This is around poor-quality diets and lack of opportunities to be active for all children and not just those who are overweight or obese,” says Davies in the report.

Davies urges that the review on VAT rates should ensure that healthy foods continue to have no VAT, while consistently applying VATto unhealthy food. Currently, for example, gingerbread men decorated with chocolate are subject to a 20 percent VAT rate, while gingerbread with no chocolate has no VAT applied. Some other types of biscuits, cakes, flapjacks and corn chips are also untaxed, while cereal bars and breakfast cereals are, further highlighting the flaws of the existing system.

The report highlights how increasing portion size has led people to eat more.Additionally, the report proposes that temperature at sale and locations should not be a factor in determining whether VAT is applied. A tiered approach is also proposed, so the unhealthiest products would have a higher rate of VAT, which would then be used to subsidize healthy food such as fruit and vegetables. Brexit can also be used to build on the successes of the UK’s current front-of-pack nutritional labeling system.

The report flags the government-led Soft Drinks Industry Levy (SDIL) as a good example of legislation that allows businesses to innovate and still make a profit. The levy, which came into effect in April 2018, has led to a sugar reduction in beverages of nearly a third, thoroughly beating the initial 20 percent target. Sales also went up, while sugar consumption went down in every socio-economic group. However, the food industry is still lagging behind with an average reduction of just 2.9 percent. 

Capping serving sizes and banning public transport eating
Increasing portion sizes are contributing to the obesity epidemic, notes the report. Since 1990, a serving of pizza has increased from 200g to 305g (53 percent), while cottage pie has ballooned from 200g to 425g (102 percent). In addition to larger sizes encouraging people to eat more, the increase has also started to shift public perception about what normal portion sizes look like. The out of home sector has especially large servings, with a recent Liverpool survey finding that a quarter of all takeout meals exceed 1,800 calories. 

In response to this, Davies proposes developing a system to apply a cap on the amount of calories per serving for all food and drink sold by the out of home sector. She also points out that there is marked variation in portion sizes between outlets and brands, with inconsistent labeling making it even more difficult for consumers to make educated choices. The calorie labeling planned for food in the out-of-home sector will help tackle these issues, she outlines. 

Meanwhile, marketing, advertising and sponsorship of unhealthy foods and drinks at all major public venues should also be phased out, according to the report. One aspect of this could be using data analytics to turn off advertisements of unhealthy food and drink for children and families replacing these with positive health messages. 

Davies also calls for a review of all tax-deductible expenses, including advertising expenses, available for the food and drink industry to ensure that these are aligned with health policies. For example, only allowing businesses to claim tax relief for advertising healthy and not unhealthy products. Finally, in order to allow children to grow up “free from marketing, signals and incentives to consume unhealthy goods,” Davies proposes a ban on eating and drinking on urban public transport. However, she does make an exception for fresh water, breastfeeding and medical conditions.Childhood obesity leads to myriad of further complications, which Davies says are cruel and avoidable.

Other key recommendations include:

• Schools should ensure healthy meals are provided at a low price, including to children receiving free school meals.
• Existing frameworks must be updated so that a business selling healthy food is recognized as different from a business selling unhealthy options.
• Build on weight management services in the NHS, with new accountability systems and approaches to delivery.

The report has been received positively by many groups, including Action on Salt, the Dental Wellness Trust and the London Early Years Foundation (LEYF). “Professor Davies’ brave call for ‘bold action’ is a beacon of hope and her sound recommendations are precisely what’s required if we are to ever achieve the government’s target to half childhood obesity in 10 years,” says Katharine Jenner, Nutritionist and Campaign Director at Action on Sugar.

“It’s unacceptable that some nurseries are inadvertently adding to the problem by serving meals dangerously high in fat, salt and sugar – and we therefore need a radical wake up. One of the biggest problems is a lack of knowledge and imagination among chefs about how to cook for children in group settings. The best way to embed a healthy food culture for children is to train those who cook, like at our Chef Academy,” concludes June O’Sullivan, CEO of LEYF. 

By Katherine Durrell