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The IUP Journal of International Relations

Revocation of Israel's Tax on Sugar-Sweetened Beverages: A Blessing or a Curse?

Article Details

Pub. Date	: July, 2023
Product Name	: The IUP Journal of International Relations
Product Type	: Article
Product Code	: IJIR020623
Author Name	: Nellie Munin
Availability	: YES
Subject/Domain	: Arts & Humanities
Download Format	: PDF Format
No. of Pages	: 24

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Abstract

This paper analyzes, as a test case, the Israeli experience of imposing a tax on sugar-sweetened beverages. Discussing the globally-acknowledged health justification for its imposition, the criticism regarding its effectiveness and the domestic political resistance that led to its eventual abolishment, the paper compares this experience with other countries' practices, drawing lessons in terms of the tax effectiveness to meet its goal, its design, the long-term economic and health implications of its abolishment and the due balance of involved interests.

Introduction

In 2021, the Government of Israel imposed a purchase tax on Sugar-Sweetened Beverages (SSBs). This move was justified on health considerations. However, the Israeli ultra-orthodox community perceived it as a political move against it. They claimed that the imposition of the tax was deliberately aimed at increasing their tax burden because nurturing big families as part of their tradition, they are major consumers of SSBs, who would thus bear the lion's share of that tax.

The fact that Israeli Finance Minister Avigdor Lieberman, in charge of taxation, was known for his liberal worldview and sharp criticism against the ultra-orthodox community for avoiding civil duties such as obligatory army service and tax payment,1 served to reinforce their claim.

The public debate which started during the legislative process continued after the tax became effective. That legislation lasted for about a year. Then, its enacting left-wing-center government was replaced by a right-wing government, in which the ultra-orthodox community was strongly represented. That new government took