The idea of higher tax on so-called 'unhealthy' food and drink products has been floating around for many years, but there are signs that the economic crisis is handing fresh impetus to proponents of the policy.

France's Government is set to hike value added tax on sugar-sweetened soft drinks from 1 January and Ireland's ministers are considering whether to follow suit. Denmark, meanwhile, has announced the world's first known tax on fatty foods.

Alcoholic drinks producers already know the script well. From Moscow to Washington, via Sydney, duty tax on different drinks has become a big issue. In Europe, duty tax rises on alcohol are explicitly supported by the European Commission, which, along with the World Health Organisation, views higher tax as a means of reducing overall consumption.

While the public health argument against such 'sin' taxes has met strong opposition, could the prolonged economic gloom be tipping the balance? As governments seek new ways of sourcing revenue, without resorting to higher tax on incomes, there is greater convergence between the thinking at treasury and health departments.

However, what ministers must weigh this against is the knock-on effects of adding pressure both to companies' margins and to consumer spending power.

Meanwhile, on just-drinks last week, we celebrated the launch of our latest collaborative report with The IWSR - The world’s top performing spirits brands 2011 edition by giving you, dear reader, a sneak preview. We also saw regular beer columnist Pete Brown ponder SABMiller's proposed takeover of Foster's Group, and conclude that it's not that duff a deal after all.

Finally, spirits guru Richard Woodard flagged up the dangers for spirits producers of over-innovation. Indeed, with the presence of the word 'ludicrous' and the phrase 'fanny around' in his commentary, Richard hasn't pulled his punches. Again.

Until next time...

Olly Wehring
Managing Editor
Web: http://www.just-drinks.com
Email: editor@just-drinks.com
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