'Fat tax' could be levied on junk food: Report

The British government may levy "fat tax" on junk food and sugary drinks in a bid to reduce obesity among consumers and reduce fiscal deficit, a media report said.

By PTI | May 10, 2010, 10.33 PM IST

LONDON: The British government may levy " fat tax" on junk food and sugary drinks in a bid to reduce obesity among consumers and reduce fiscal deficit, a media report said.

According to The Telegraph, the Food Standards Agency (FSA) -- a UK government body protecting health and consumer interest related to food -- is planning may consult on whether taxing such foods would encourage people to make healthier choices.

The "fat tax" would be applied to processed foods, snacks and sugary drinks in much the same way as taxes on alcohol and tobacco.

However, the FSA is also considering the possibility of imposing 17.5 per cent VAT to foodstuff like fat milk, butter and cheese to encourage consumption of products with less saturated fat.

The FSA fears that the nation's excessive consumption of saturated fat is leading to an increased numbers of deaths through clogged arteries and heart disease.

The scheme has met with opposition from consumer groups, the daily said.

However, some research has claimed a fat tax could save up to 3,000 lives per year, the report noted.

According to The Telegraph, research by the Institute for Fiscal Studies warned that any fat tax would have a negative effect on poorer families and have a greater impact on their food budget than on richer families.

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