JAKARTA, April 10 (Jakarta Post/ANN): A Jakarta-based public health think tank is making an urgent appeal for the government to impose excise taxes on all packaged sugary beverages flooding the market, on account of the increasing prevalence of diabetes and swelling healthcare spending for obesity-related diseases.
Practical solutions are sought as Indonesia tries to recover from a devastating Covid-19 pandemic that has exposed cracks in its healthcare system, as well as the lack of attention to serious illnesses such as Type 2 diabetes.
In its latest report, the Centre for Indonesia’s Strategic Development Initiatives (CISDI) highlighted the fact that a tax on sugar-sweetened beverages is a cost-effective policy recommendation that could go a long way toward improving people’s health and economic wellbeing.
The research points to case studies in Mexico and the United Kingdom, which suggest that introducing even a 10 percent tax was already effective in reducing consumption.
“The implementation of a 10 percent tax excise on sugary drinks in Mexico could reduce the consumption of sweetened beverages by 19 percent. (Meanwhile) in the UK, the sugary beverages tax has led to a widespread reformulation of products to reduce sugar levels by manufacturers,” CISDI researchers said in the report.
Some studies, the think tank noted, have suggested that imposing an excise tax of Rp 5,000 (35 US cents) per liter on sugary drinks could prevent between 12,000 and 417,000 cases of obesity in Indonesia in the next 25 years, and around 63,000 to 1.4 million cases of Type 2 diabetes.
Researchers also noted that based on estimates from the Finance Ministry, taxing sugar-sweetened beverages between Rp 1,500 and Rp 2,500 per liter could generate state revenue figures somewhere in the ballpark of Rp 2.7 trillion to Rp 6.25 trillion annually, which could be used to increase much-needed funding for non-communicable disease (NCD) prevention.
According to a 2021 estimation report from the International Diabetes Federation (IDF), Indonesia is among the top five countries with the highest number of diabetes patients in the world, with around 19.5 million adults in the country suffering from an illness that significantly increases the risks of other ailments.
The report suggested that diabetes prevalence among people aged 20-79 in Indonesia stands at around 10.8 percent – meaning that one in 10 adults in the country suffers from the chronic disease.
The number of diabetic patients in 2021 increased nearly twofold from 2019 and threefold from 2011, when Indonesia was estimated to have around 10.7 million and 7.3 million diabetics, respectively.
Making matters worse, the IDF estimates that 74 percent of Indonesian adults with diabetes, or some 14.3 million people, are currently undiagnosed and untreated.
The pandemic also deepened Indonesia’s diabetes crisis, with the illness becoming the most common risk factor or comorbidity associated with COVID-19 deaths this year.
A 2021 World Health Organization report, analysing Covid-19 data from 13 countries in Africa, revealed that the fatality rate among people with diabetes was twice as high as that of patients suffering from any other comorbidity.
Soebagijo Adi Soelistijo, an endocrinologist from the Indonesian Society of Internal Medicine (PAPDI), told The Jakarta Post that people with diabetes were more prone to contracting Covid-19, more likely to develop severe symptoms and die if infected and more likely to develop excess conditions after they recover.
Meanwhile, CISDI said that Indonesia’s growing diabetes problem had weighed heavily on the Healthcare and Social Security Agency (BPJS Kesehatan), with medical expenses for diabetes growing by 8 percent each year.
In 2019, BPJS Kesehatan spent Rp 108 trillion in medical expenses for diabetes treatments, a 29 percent increase compared with 2017, which saw Rp 84 trillion spent.
Experts have attributed Indonesia’s rising diabetes prevalence to a growing societal shift toward sedentary lifestyles and unhealthy diets.
Between 1996 and 2014, the annual consumption of sugary drinks in the country increased fifteen-fold, from 51 million liters to 780 million liters.
In 2020, Indonesia became the third-highest consumer of sugar-sweetened beverages in Southeast Asia. Research suggests that people who regularly drink sugary beverages of one to two servings per day have a 26 percent greater risk of developing Type 2 diabetes than people who rarely consume them.
A study from the United States also found a particularly strong link between drinking sugary beverages and an increased risk of early death from cardiovascular disease.
Compared with infrequent consumers, those who drink two or more servings per day had a 31 percent higher risk of early death from cardiovascular disease, with each additional serving of sugary drink per day linked to a 10 percent increase in the risk of cardiovascular disease-related death.
The Finance Ministry has been entertaining the idea of imposing a tax on sugary drinks since 2009, but progress has been slow on that front.
In 2018, the ministry released a report highlighting the urgency of the proposed excise tax but also pointed out that resistance from business players and the Industry Ministry has made it difficult for the policy to be executed.
In 2020, Finance Minister Sri Mulyani Indrawati once again proposed the implementation of a sugary drinks tax, and although the ministry has created a more detailed scheme for the excise, the plan has yet to bear any fruit.
The ministry’s director general for customs and excise, Askolani, said on Monday that his office would “wait and see” whether it was possible to introduce the tax in the current state of pandemic and economic recovery.
“We will consider all the options. We may yet impose the tax by the end of 2022 or next year, depending on the economic situation,” he said at a hearing with House of Representatives Commission IX overseeing health. – The Jakarta Post/ANN