Do high vs. low purchasers respond differently to a nonessential energy-dense food tax? Two-year evaluation of Mexico's 8% nonessential food tax

Abstract

It is unclear whether response to a nonessential food tax varies across time or for high vs. low-consuming households. The objective is to examine whether the effect of Mexico's 2014 8% nonessential energy-dense foods tax increased in the second year post-implementation and whether it differentially affected households by pre-tax purchasing pattern. We used longitudinal data on Mexican household food purchases (n=6089 households) from 2012 to 2015. Households were classified based on median pre-tax purchases: low untaxed/low taxed ("low"), low untaxed/high taxed ("unhealthy"), high untaxed/low taxed ("healthy"), and high untaxed/high taxed ("high") purchasers. Fixed effects models tested whether observed post-tax purchases differed from the counterfactual, or what would have been expected based on pre-tax trends. Post-tax declines in the % taxed food purchases increased from -4.8% in year one to -7.4% in year two, yielding a 2-year mean decline of 6.0% beyond the counterfactual (p<0.01). Post-tax change in % taxed food purchases varied by pre-tax purchasing level. Healthy purchasers showed no post-tax change in % taxed food purchases beyond the counterfactual, while unhealthy, low and high purchasers decreased (-12.3%, -5.3% and -4.4%, respectively) (p<0.01). The positive effect of Mexico's junk food tax continued in the second year, and households with greater preferences for taxed foods showed a larger decline in taxed food purchases.

Keywords: Evaluation; Food taxes; Household purchases; Mexico.

Figure 1

Unadjusted monthly trends in predicted volume purchased (g/capita/month) of A) Taxed and B) Untaxed foods for the overall sample and by pre-tax household food purchasing group. Source: Authors’ own analyses and calculations based in part on data reported by Nielsen through its Mexico Consumer Panel Service for food and beverages or the January 2012 to December 2015. Nielsen data is licensed from The Nielsen Company, 2017. The conclusions drawn from the Nielsen data are those of the authors and do not reflect the views of Nielsen. Nielsen is not responsible for and was not involved in analyzing and preparing the results reported herein.

Figure 2

Monthly trends in predicted % taxed foods purchased of A) Overall sample and B) By pre-tax household food purchasing group. Source: Authors’ own analyses and calculations based in part on data reported by Nielsen through its Mexico Consumer Panel Service for food and beverages or the January 2012 to December 2015. Nielsen data is licensed from The Nielsen Company, 2017. The conclusions drawn from the Nielsen data are those of the authors and do not reflect the views of Nielsen. Nielsen is not responsible for and was not involved in analyzing and preparing the results reported herein.