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The Mexico Story

Backers of the beverage tax in Mexico made big promises but didn’t deliver on any of them. The tax didn’t reduce obesity, and was one of the reasons that tens of thousands of small stores shut down and 50,000 jobs were lost.

The beverage tax in Mexico was championed as a way to tackle obesity without harming jobs. But the aftermath of the tax shows these claims don’t add up.

In 2014, a one-peso-per liter tax on sugar-sweetened beverages took hold in Mexico. Two years later, studies show that the decrease in calories as a result of the tax was so scant, that it wouldn’t register on a bathroom scale. In fact, obesity rates have RISEN since the tax has been in effect.

Small businesses and jobs were the big losers. Data from the Mexico Small Shop Keepers Association shows 30,000 mom and pop stores closed across the country, causing more than 50,000 job losses. The beverage industry and its main suppliers lost nearly 11,000 jobs alone.

The situation in Mexico proves that taxes are not the answer to the world’s public health challenges. They cost consumers and harm small businesses without making anyone healthier.

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