Mexico’s congress has been accused of caving into pressure from the fizzy drinks industry after agreeing to cut a groundbreaking tax on sugar-sweetened beverages.

Studies had shown that the tax, introduced in January 2014, had started to curb soda consumption in a country confronting crises of childhood obesity and diabetes.

The finance commission in the lower house of Congress approved halving the tax on sweetened drinks if the sugar content is less than five grams per 100 millilitres – an incentive for beverage producers to offer more low-calorie options, according to lawmakers with the right-leaning National Action Party (PAN).

But public health groups and some opposition politicians accused lawmakers of caving to pressure from drinks manufacturers and taking an incorrect approach to lowering calorie consumption.



“This measure weakens the tax and could weaken its effects,” said Dr Juan Rivera Dommarco, adjunct director of nutrition and health in Mexico’s National Institute of Public Health (INSP). “The way to safeguard public health is to increase the tax … then reduce it on the products that have less sugar.”



In January 2014, Mexico slapped a tax of one peso (six cents) per litre on sugary drinks, increasing the price of sodas by about 10%. It also applied a tax on high-calorie snacks like cookies and crisps.



The tax on sugary drinks has been held up as an example for other countries to follow, especially as diseases like diabetes and obesity boom in the developed and developing world alike.



Preliminary results from a study on the tax by researchers at INSP and the University of North Carolina showed a 6% reduction in soda consumption during 2014, with the rate increasing as the year progressed.



Mexicans guzzle more than 43 gallons of soda per person per year, according to the Rudd Center for Food Policy and Obesity at Yale University, while a preference for low-calorie versions of soft drink standbys has never taken hold.

Rivera attributed the thirst for soda to trends such as Mexicans weaning babies on soft drinks. And while potable water is not available in many parts of the country, soft drink bottlers operate networks delivering their products to the most remote and insecure corners of the country. Advertising is also intense, with companies like Coca-Cola sponsoring Christmas trees in public squares across the country, covered with ornamental logos.

Mexico’s soft drink makers’ association, ANPRAC, disputes the impact of the tax and drop in consumption. It says instead sales have slid 2.5% since the tax was applied and 1,700 jobs have been lost. It estimates the tax lowered caloric consumption by 6.2 calories per day.



Sugary drinks account for an estimated 35% of sales in the country’s ubiquitous corner stores, according the National Association of Small Merchants (ANPEC), which accused the federal government of taxing soda to extract money from the nearly 60% of the population in the informal economy.



ANPEC president Cuauhtémoc Rivera said bottlers began selling more soda in returnable containers as a way to offset the cost of the new tax and consumption levels seem to have stabilized.



He also noted: “It’s not clear that the money being collected is going toward fighting obesity.”



It’s unclear how many brands the new tax treatment would apply to as sales of low-calorie and artificially sweetened sodas are lower in Mexico than other countries.

“They’re small changes that basically benefit the companies,” lawmaker Vidal Llerenas of the leftwing party Morena told online news outlet Sin Embargo. “Basically, there was pressure from the private sector to push some modifications such as this to be able to reduce the tax.”

