Hungary To Be The World's No.1 With Hamburger Tax

The country’s Health Ministry announced exactly a month ago that they would put off the implementation of the "hamburger tax" and the issue may be put back on the agenda only in 2011.

Under Csiba’s proposal, a HUF 10 surtax would be levied on each bottle or pack of unhealthy products sold in Hungary, including alcohol, tobacco, potato chips, hamburgers and soft drinks. The additional tax could help raise up to HUF 100 billion in revenues which could be used to cover the costs of state healthcare services, he argued.

On Tuesday, Csiba told public television MTV that "we did not invent it [the "hamburger tax"], they introduced it in Romania a few months ago so the idea is not new."

This statement is half true, half humbug, though. Romania’s Health Ministry was in fact mulling such fast food tax, but a month ago it announced that the surcharge would not be implemented this year. Romanian business daily Ziarul Financiar reported at the end of May that the deadline for Health Minister Attila Cseke’s proposal submitted in January lapsed in March and that the ministry’s press department informed them that there was no room to levy the "hamburger tax" under the current economic conditions.

The Romanian initiative

Attila Cseke announced his proposal on the junk food tax in January, which triggered uproad in the industry. The players of the sector warned that the new tax would lead to price hikes and layoffs, and could also increase tax evasion. At that time, however, the Health Ministry failed to specify which food products the new tax would be levied on. It only said that products with high sugar and fat content, e.g. bakery goods, chips, beverages with high added sugar content, would be taxed. The ministry projected in February that the budget would gain additional revenues of EUR 700 m from the new tax.

Cseke repeatedly said that the proceeds would be used for prevention and programmes to raise junk food awareness. The European Union announced in January this year that member states may impose a tax on fast food and food products that are deemed unhealthy.

While Romania put off the implementation of the tax, it did not surrender the notion entirely, saying the issue could be tabled next year again. Otherwise, Romania would have been the first in the world to levy a tax specifically on unhealthy food products.

Hungary the copycat

So, if Hungary decided to put a "hamburger tax" into effect this year, it will be the first country ever to punish unhealthy eating and drinking this way.

Csiba claimed the new tax - HUF 10 on each bottle or pack of unhealthy food products - would raise HUF 100 billion revenues that would exactly cover the deficit of Hungary’s healthcare budget.

Csiba told the public television that there are scientific institutions that have the expertise to determine which food product is healthy or unhealthy. He said people consuming unhealthy products should accept if prices go up since their possible medial treatments cost a lot.

Jenő Rácz, President of the Hungarian Hospital Association, welcomed the idea of the "hamburger tax", saying this was one possible means to generate funds for the health budget. But he warned that the problems of the healthcare system cannot be solved by the new tax alone, as further resources need to be found.

Figh against obesity

The idea of a special tax on unhealthy food products (mostly fast food and beverages with high added sugar content) is not new. The World Health Organisation (WHO) had come up with the idea of such surcharge - dubbed "fat tax", "hamburger tax" or "obesity tax" - already in 2003 to fight unhealthy diets and reduce spreading obesity. According to WHO, obesity is the second-highest risk factor after smoking. According to 2005 data by WHO, there were 1.6 million overweight people in the world, 400 m of whom were obese.

WHO projects that by 2015, around 2.3 billion adults will be overweight and more than 700 million will be obese. At least 20 million children under the age of 5 years are overweight globally in 2005.

Overweight and obesity lead to serious health consequences. Risk increases progressively as BMI increases. Raised body mass index is a major risk factor for chronic diseases such as:

* Cardiovascular disease (mainly heart disease and stroke) - already the world's number one cause of death, killing 17 million people each year.
* Diabetes - which has rapidly become a global epidemic. WHO projects that diabetes deaths will increase by more than 50% worldwide in the next 10 years.
* Musculoskeletal disorders - especially osteoarthritis.
* Some cancers (endometrial, breast, and colon).

Childhood obesity is associated with a higher chance of premature death and disability in adulthood.

Underweight, overweight or obese?

Overweight and obesity are defined as abnormal or excessive fat accumulation that may impair health.

Body mass index (BMI) is a simple index of weight-for-height that is commonly used in classifying overweight and obesity in adult populations and individuals.

Body Mass Index (BMI) is a simple index of weight-for-height that is commonly used to classify underweight, overweight and obesity in adults. It is defined as the weight in kilograms divided by the square of the height in metres (kg/m2). For example, an adult who weighs 70kg and whose height is 1.75m will have a BMI of 22.9.

BMI = 70 kg / (1.75 m)2 = 70 / 3,0625 = 22.9

BMI provides the most useful population-level measure of overweight and obesity as it is the same for both sexes and for all ages of adults. However, it should be considered as a rough guide because it may not correspond to the same degree of fatness in different individuals.

The World Health Organization (WHO) defines overweight as a BMI equal to or more than 25, and obesity as a BMI equal to or more than 30. These cut-off points provide a benchmark for individual assessment, but there is evidence that risk of chronic disease in populations increases progressively from a BMI of 21."

Source: Portfolio Online Financial Journal