Lawmakers are easily in favor of advertising restrictions (and new taxes).

Legitimate concern versus Hypocrisy.

Let me be clear about one thing: I am absolutely no fan of Wild West scenarios in advertising, wherever commercial communication is performed, be it through traditional media or in the online world. Cleary just like in any other business sector, there need to be rules.

However, by now I have seen far too often lawmakers raising their voices about issues – though widely ignored in the past – when they, in a certain moment, are at the center of a general debate. Just think of issues linked to the negative impact of the consumption of tobacco products or alcoholics on public health or related to obesity problems and nutritional disorders, to pollution, to environmental impact, to children’s wellbeing, etc.

The common trick.

Any time those issues become a matter of public sensitiveness, a lawmaker will try to take the lead and to establish himself as the Champion of the respective concerns. The reason is obvious: it is easy to gather a huge crowd and a broad consensus, there is almost no risk to face a strong opposition. Hence, the risk of disappointing voters is quite low.

Politicians usually rely on two standard approaches for offering solutions to such issues: (a) introducing new restrictions for the promotion and marketing of the questioned products, services or behaviors, (b) hitting them with new taxes.

Such measures are mostly announced with fanfares and flourishing trumpets.

A look around.

Over the last years food products and beverages high in fat, sugar and salt have increasingly drawn the attention of lawmakers and have therefore become the target of additional regulation and of ‘special’ taxes.

In France, the so-called ‘soda tax’ (i.e. a 7 cents per liter tax) on soft drinks was introduced in 2012. As such initiative resulted in a significant increase of the beverages’ sales prizes, the system changed in 2018. Now, the tax is commensurate with the quantity of sugar present in a soft drink (from 3 up to 23 cents per liter). The result: different countries you travel to in Europe, different amounts of sugar you will find in you soft drink.

In 2018, Great Britain adopted the Soft Drinks Industry Levy (commonly called the ‘sugar tax’) also applied accordingly to the quantity of sugar present in the beverage (with a no tax area up to 50 grams of sugar, with a 20 cents per liter taxation for a presence of from 50 to 80 grams of sugar per liter and with 27 cents for sugar over 80 grams).

Worldwide more than 40 countries have similar measures in place.

Now Italy intends to join the club.

While finalizing – in December 2019 – the 2020 Budget Law, the Italian House decided to follow this trend, by introducing:

- the ‘Plastic Tax’, to be applied on plastic products meant to pack, to protect or for the handling of foodstuffs, save the case they are recyclable and compostable (an exemption is provided for plastic containers of medical devices or pharmaceuticals). The tax rate will be Euro 0,45 per kilo of plastic, and it will become effective at some point during the first semester of 2020 (probably in July, depending on when detailed implementing rules are ready and issued by the competent local Authority),

- the ‘Sugar Tax’ – to become effective in October 2020 – applicable to fizzy drinks containing more than 25 grams of sugar at a rate of 0,10 cents per liter for beverages ready to be consumed and at 0,25 cents per kilo for products requiring dilution before consumption.

A few thoughts about the potential effectiveness of the new Italian rules.

To no one’s surprise these measures are already strongly opposed by the respective industry sectors. Their representatives are depicting catastrophic scenarios as to decreasing sales and subsequent layoffs of employees. One major US based soft-drink producer has gone so far to hint at the necessity to transfer its local branch to Eastern Europe. The pressure got to a point where the Italian Government has stated that it will have a closer look at these measures, eventually adapting them to avoid an improper impact on the specific industry sector. To the purpose a Government speaks-person has announced that a serious confrontation with the relevant stakeholders will take place.  

To address this objectively, it seems quite clear that the aim to reduce sugar content in food (especially in products particularly popular among children and teenagers) is justified by grounded health reasons. Obesity is a worldwide and serious problem, not just a concern of nutrition freaks.

However, it has also to be acknowledged that right now a consumer of a soft drink will find himself taking a product (even of the same brand) with significantly differing levels of sugar content, depending on the country he is in (e.g. UK, France, Spain, Italy, etc.).

In addition, what’s the point of introducing a ‘sugar tax’ when it does not apply to snacks? If health issues are a legitimate concern, then the specific problem should be addressed on a broader and more structured basis. Otherwise these measures it will just look like an attempt to collect additional financial revenues (which Italy is in desperate need of).