Sugar Tax

Question 1

Excise Tax

Answer 1

Is an indirect tax. It is a tax that is paid to the government, usually by the producer, but it is passed on to the consumer as part of the price of a good or service

Question 2

Stake holders

Answer 2

A group or individual who has an interest in, or is affected by, the activities of a business or organisation.
When making decisions, the business needs to consider all the groups or individual who may be affected either in a positive or negative way.

Question 3

If a sugar tax is in place it will affect:

Answer 3

• healthcare system (hospitals, workers)
• Beverage producer (coca-cola)
• Consumer (including young children)
• Sugar cane industry (framers)

Question 4

The law of unintended consequences

Answer 4

Unintended consequences are outcomes that are not the ones foreseen and intended by an action or a decision. These outcomes can be positive or negative

Question 5

Intended impact of sugar tax

Answer 5

As price goes up people stop buying sugary drinks; reduces consumption

Question 6

Unintended impact of sugar tax

Answer 6

• Move on to drinking alcohol as it is cheaper
• Start stealing sugary drinks
• Keep buying the item but aren’t paying for needs such as food or shelter
• Drinking more tap water using reusable water bottles thus reducing plastic bottle waste

Question 7

3 reasons why the government may intervene

Answer 7

1. To stabilise the economy
2. To relocate resources
3. To redistribute income

Intervenes to produce more goods and services

Question 8

Impact an excise tax would have on the price and quality demanded for these products

Answer 8

Excise taxes aim to increase the price payed by consumers in order to reduce the amount of demand for these goods

Question 9

Alternatives to implanting a sugar tax

Answer 9

1. Make healthier products cheaper
2. Sell less of the product
3. Advertise to reduce sugary consumption - heart disease, obesity, diabetes
4. Government educating children better