North

Proposed tax on sweet drinks in N.W.T. gets some bitter reception

The Northwest Territories government is proposing a new tax on sweetened drinks — and it's elicited strong responses from some residents.

Beverage industry says tax will cost jobs; Tuktoyaktuk mayor calls idea 'plain stupid'

The territorial government is proposing a tax on all sugar-added beverages, from sports drinks to ready-to-drink ice tea. (Matt Rourke/Associated Press)

A proposed new tax on sugary sodas is getting a bitter reception from some N.W.T. residents.

The Government of the Northwest Territories is proposing a new tax on sugar-sweetened drinks — everything from sports drinks to ready-to-drink iced tea.

Though the idea was first floated in 2017, the announcement of engagement sessions next week elicited strong responses from some N.W.T. residents.

"That's just plain stupid!" wrote Tuktoyaktuk mayor Merven Gruben in an email. "Just another tax grab from the money hungry cash strapped [territorial government]!"

The government is proposing a tax of five cents per 100 ml for pre-packaged products, or about 30 cents for a standard bottle.

Fountain drinks would be taxed according to size, beginning at 10 cents for 250 millilitres and ending at 45 cents for any quantity over 750 millilitres. (For comparison, a large drink at McDonald's is 730 millilitres.)

A blood sugar test, pictured in Tennessee in 2014. The territorial government says Type 2 diabetes and poor dental health are 'serious public health issues' in the Northwest Territories. (Mark Zaleski/Associated Press)

Cost of living

The rise in price would affect every northern retailer of Coke and Pepsi products, according to Caroline Browning, the general manager of Yellowknife Beverages, Coca-Cola's distributor in the territory.

Both Browning and Tara Weaver-Pagonis, general manager of Pepsi distributor Territorial Beverages, pointed to the potential impacts on cost of living.

The Canadian Beverage Association (CBA), which represents 60 beverage brands sold in Canada, said in a statement that sugar-sweetened beverage taxes "do not work."

"These taxes have been tried in Mexico, Denmark and cities in the United States," it wrote. "The tax did not reduce obesity; it did however cause job losses in the food and beverage sector."

Inuvik is one of three communities that will host public engagement sessions next week. (Mark Hadlari/CBC)

Tax intended to reduce obesity, diabetes

The government's discussion paper says sugar-sweetened beverages are the "single largest" source of sugar in northerners' diets.

Medical research has linked added-sugar foods to obesity, Type 2 diabetes, and poor dental health, which the government says are "serious public health issues" in the territory.

In the N.W.T., two in five adults are considered obese, significantly higher than the national average, and the primary reason children under the age of five are hospitalized is the "surgical extraction of decayed teeth," the document reads.

"When I see children who are overweight or obese in my office… the first thing I ask them is, 'What do you like to drink?'" said Dr. Tom Warshawski, a pediatrician and chair of the Childhood Obesity Foundation.

"We know that if we put a tax on them consumption will decrease. That's why the beverage companies fight these things tooth and nail."

The CBA's statement says the beverage brands "are committed to supporting solutions to the complex health issues… that Northern, remote and indigenous communities face."

"The solution to addressing these issues however, is not a tax," it wrote.

The CBA pointed to the "Balanced Choices NWT" campaign it's running, which is a "point of sale education program." The initiative places decals reading "balance what you eat, drink, & do" in English and five Indigenous languages on beverage coolers and fridges across the territory.

Engagement sessions scheduled during IRC forum

The government has scheduled public engagement sessions in Inuvik, Tuktoyaktuk and Yellowknife on Jan. 28 and 29.

In a written statement, the governemnt said the three communities are representative of the territory's "three community types" — large communities, regional centres, and "a smaller, remote community."

The public engagement session dates overlap with a pre-election forum and vote for the chair of the Inuvialuit Regional Corporation, which will occupy the Inuvialuit leadership from the two Mackenzie Delta communities.

Todd Sasaki, senior communications officer for the Department of Finance, said in an email that "the [territorial government] did not factor the IRC elections into its" choice of dates.

"We anticipate that interested residents of those communities will take advantage of the opportunity to attend the public meetings," he wrote.

There are no other engagement sessions planned. The public can weigh in on the proposed tax until Feb. 25 via an online survey

Corrections

  • A previous version of this story said, in a photo caption, that two in five N.W.T. adults have Type 2 diabetes. In fact, two in five adults are considered obese in the territory.
    Jan 25, 2019 3:52 PM CT

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.