GS 2 – SOCIAL JUSTICE
Context:
From September 22, 2025, India will simplify GST by merging 15 tax slabs into four main rates — 5%, 15%, 25%, and 45% (luxury tax). While this move aims to simplify taxation, it raises concerns about dietary health due to changes in food product pricing, especially ultra-processed and unhealthy foods.
Key Highlights
- Changes Under GST 2.0
- Many everyday food items will become cheaper, including:
- Pizza, bread → GST drops from 5% to 2%.
- Sugary and processed foods such as chocolates, jams, and soft drinks → GST reduced from 28% to 15%.
- Healthier options like water and unsweetened beverages will see tax increase from 18% to 40%.
Implication:
- Unhealthy food becomes more affordable, while healthier alternatives become relatively expensive, potentially encouraging poor dietary choices.
- Impact on Public Health
- India’s obesity and diabetes rates are rising, particularly among children and adolescents.
- Processed food consumption is increasing due to urbanization and lifestyle changes.
- Lower taxes on high-calorie, high-fat, high-sugar foods could:
- Increase non-communicable diseases (NCDs) such as diabetes and heart disease.
- Reverse public health gains achieved through dietary interventions.
- Global Comparison
- Global best practices show the need for nutrient-based taxation:
- Mexico and Chile implemented taxes on sugary drinks and ultra-processed foods, leading to reduced consumption.
- WHO recommends clear food labeling and higher taxation on unhealthy products to curb obesity.
- Role of Food Labels and Regulation
- The Supreme Court directed the Food Safety and Standards Authority of India (FSSAI) to implement front-of-pack labeling (FOPL) by 2026.
- FOPL helps consumers make informed choices by:
- Marking high sugar, salt, and fat content foods with warning labels.
- Similar to cigarette warnings, creating behavioral awareness.
- Delay in labeling implementation has stalled health reforms.
- Role of Advertisements
- Advertising heavily influences dietary choices, especially among children.
- Many ads promote unhealthy foods, often targeting vulnerable groups.
- Countries like Chile and UK have imposed restrictions on junk food ads, especially during children’s TV hours.
- India currently lacks strong regulations in this area.
Challenges Ahead
- Health inequity: Lower-income groups may opt for cheaper, unhealthy foods due to price incentives.
- Policy misalignment: Tax reform prioritizes economic simplification over public health concerns.
- Enforcement issues: Weak monitoring of food labeling and advertising standards.