Fat Tax for Mexico

October 21, 2013 Taxation in MexicoTaxation in South America

Five Guys MealMEXICO CITY – The government of Mexico is looking to tax unhealthy foods in order to improve the health of its citizens and reduce the sale of fatty, sugary and calorie-rich foods.

Late last week the Chamber of Deputies of Mexico approved a new “fat tax” of 5 percent on the sale of any containing more than 275 calories per 100 grams, in an effort to curb the widespread habit of the Mexican population to consume fast foods and other unhealthy goods.

The Chamber also approved an additional taxes of MXN 1 per liter on the sale of sugary soft-drinks, and a 16 percent tax on chewing gums.

It is currently estimated that more than 7 out of every 10 adults in Mexico are overweight or obese, the highest rate in any OECD nation, and, according to the government, the weight issues currently places a burden of approximately MXN 38 billion per year on the national health system.

Health advocacy groups in the country are claiming that the new tax will directly encourage locals to steer away from calorie-dense food, and to switch to healthier alternatives, directly boosting Mexico’s economy by slashing health care costs and reducing the occurrence of productivity-loss caused by health issues.

The proposal to implement the tax still needs to be approved by the Senate before being enacted.

Photo by Ramen Junkie