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New Taxes on Sugary Drinks, Syrups, and Concentrates Approved as of February 2019


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8% tax charge proposed for sugary drinks

 
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  • Draft 104 was presented in the National Assembly, which proposes to charge an 8% tax on the sale of sugary drinks such as sodas, juices of unnatural fruits and energy drinks.
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  • National Assembly President Yanibel Abrego Smith said the measure does not seek to create a new levy but to curb the advance of diseases associated with sugar consumption such as diabetes, obesity and hypertension.
     
    “We are not moved by any other interest than the health of our population,” she said. According to the World Health Organization diabetes–related deaths will increase by 34% worldwide in the coming years.
     
    The total collection of this tax will be directed to Panamanian health institutions. 25% will be allocated to the Ministry of Health and 75% to the National Cancer Institute.
     
    With this law, Panama would become part of the group of 18 countries in the world that tax drinks containing sugar.
     
 
Edited by Keith Woolford
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Panama: Tax on Sugary Drinks

A legal initiative aims to establish a selective consumption tax of 8% on the price of sugary drinks, whether they be imported or domestic.

Wednesday, October 4, 2017

Although the bill introduced by two deputies of the Democratic Revolutionary Party (PRD) has yet to be discussed in the Legislative Assembly, the Varela administration has already announced that it does not support the initiative. See also : "Alcoholic Beverages Market in Central America"

In regards to the initiative, Prensa.com reports that "... it consists of five articles and establishes an excise tax on consumption of sugared drinks of 8% on the price, whether they be imported or domestic. These drinks are: carbonated or soft drinks, processed and packaged unnatural fruit juices, and energy drinks."

"... The total amount collected for this tax would be divided up as follows: 75% for the National Oncology Institute and 25% for the Ministry of Health."

 

https://www.centralamericadata.com/en/article/main/Panama_Tax_on_Sugary_Drinks

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More Taxes on Sugary Beverages

In Panama, a proposal is being discussed that seeks to increase from 5% to 8% the Selective Consumption Tax on soft drinks, carbonated beverages, processed juices and other sugary beverages.

Friday, October 26, 2018

Laestrella.com.pa reports that "... The vice president of Corporate Affairs of the National Brewery, and representative of the Industrial Union of Panama (SIP), Juan Antonio Fabrega, warned last Tuesday that jobs generated by the industry of sugary beverages could be reduced, if the Selective Excise Tax is increased from 5 to 8%, as established by Law 570, which will be discussed today in the first debate in the Economy and Finance Commission of the National Assembly."

See "Fruit and Vegetable Juices: Purchases increase 4%"

The 8% tax on the price would affect imported beverages or those produced in the country, among which are sparkling or carbonated beverages, processed and packaged fruit juices and non-natural energy drinks.

Regarding the issue, on October the 24th the National Assembly reported that in the first debate the Project of Law No.570 was approved, which establishes the selective tax on the consumption of sugary beverages, after extensive consultations with the private sector, Health, MEF, CSS and other agents, in the Commission of Economy and Finances.

You may be interested "Purchases of Non-Alcoholic Beverages up to 1st Quarter"

The initiative emphasizes that it is evident that the high prevalence of obesity in our population is due, in part, to the consumption of these beverages that are ultimately reflected in increased rates of diseases such as diabetes and cancer, the statement said.

See Project of Law 570.

 

https://www.centralamericadata.com/en/article/main/More_Taxes_on_Sugary_Beverages

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New Tax on Sugary Drinks

Despite the rejection of the business sector, a law was approved in Panama that establishes an 8% tax on imported and domestically produced sugared beverages.

Tuesday, February 12, 2019

The National Assembly reported that it approved, in the third debate, Law 570, which establishes a tax of 8% for domestically produced and imported sugary beverages and 10% for syrups and concentrates.

See "Non-Alcoholic Beverages: Imports up to the First Semester"

Anel Flores, director of Alanje's sugar mill, said to Laestrella.com.pa that "...this is a measure that 'is not really going to contribute to the reduction of obesity and diabetes'. The solution is not to satanize sugar as the cause of obesity and diabetes, it's very overstated."

Also see "Bottled water: Imports up to June 2018"

Flores added that "... the bill could affect a sugar industry that directly and indirectly employs 25,000 individuals, as well as the different producers of juices and soft drinks." That will make the product more expensive, affecting the consumer final, will bring reduction of personnel in all those plants', I also recommend to President Juan Carlos Varela veto the bill, considering that it is not appropriate, given the current economic situation, adopt new taxes and taxes that will attempt against 'the most vulnerable sector, which is that of rural and agricultural employment in the country'."

Read full article (In Spanish).

 

https://www.centralamericadata.com/en/article/main/New_Tax_on_Sugary_Drinks

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  • Moderator_02 changed the title to New Taxes on Sugary Drinks, Syrups, and Concentrates Approved as of February 2019
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Business group opposes sugary drinks tax

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Posted 22/02/2019

Panama’s Chamber of Commerce, Industries and Agriculture (Cciap)  has stepped into the debate over the taxing of sugary drinks and has asked the President Juan Carlos Varela, for a partial veto of on Bill No. 570 that creates an action plan to improve health.

The project sets a selective tax of 7% for soft drinks, 5% for the rest of the sweetened beverages, whether domestically produced and imported, and 10% for syrups, syrups, and concentrates for the production of sugary drinks.

The funds collected by the tax are destined to the National Oncology Institute and the Ministry of Health, in a ratio of 35% and 25%, respectively. The rest will be distributed among the programs of the clinics of patients with diabetes 15%, Ministry of Education 15%, Ministry of Agricultural Development 5% and the Ministry of Commerce and Industries 5%.

In a letter dated February 21, Cciap reiterated its rejection of the new tax. The organization insisted that during the discussion of the bill, it stated that the Panamanian population should be educated in the promotion of action plans that encourage healthy living habits. To achieve this, it proposed the establishment of a public-private fund in order to achieve these objectives. 

 

https://www.newsroompanama.com/health/business-group-opposes-sugary-drinks-tax

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Proposal to Veto New Tax on Sweetened Beverages

Panama's business sector asked President Varela to partially veto Law 570, which establishes an 8% tax on imported and domestically produced sugared beverages.

Friday, February 22, 2019

The rejection of the business sector comes days after the National Assembly approved, in third debate, the bill 570, which establishes an 8% tax for sugared beverages of national production and imported and 10% for syrups and concentrates.

See "Non-Alcoholic Beverages: Imports up to the First Semester"

Through a letter sent to President Juan Carlos Varela, the Chamber of Commerce, Industry and Agriculture of Panama (CCIAP), argued that to meet the objectives of the tax they recommend educating the population by promoting action plans that instill healthy lifestyle habits, rather than taxing the consumption of beverages.

"… The veto request to article 13 is based on the note sent by the Ministry of Commerce and Industries to the plenary of the National Assembly, pointing out that within the framework of the process of incorporation of the Republic of Panama to the Central American Economic Integration Subsystem (SIECA), this issue is part of the ongoing negotiations, in the field of Central American technical regulations and commitments derived from the Association Agreement in force with the European Union (ADA)," explains the letter from CCIAP.

Also see "Bottled water: Imports up to June 2018"

"... Aware of the purpose that this initiative wishes to achieve, and based on the above, we request the partial veto of Bill No. 570 'That creates the Action Plan to improve Health and dictates other provisions to establish the selective tax on consumption of sugary beverages and the criteria for their use,'" concludes the document.

See letter from CCIAP.

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https://www.centralamericadata.com/en/article/main/Proposal_to_Veto_New_Tax_on_Sweetened_Beverages

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Controversy Over Tax on Sweetened Beverages Remains

Although at the request of the business sector, President Varela vetoed the bill establishing an 8% tax on local and imported sugary beverages, Panama's National Assembly will insist on approving it.

Wednesday, April 3, 2019

The National Assembly approved in third session the new taxes, however, the business sector asked the Panamanian president at the end of February 2019 to veto the bill, which establishes a tax of 8% for sugared drinks of national production and imported and 10% for syrups and concentrates.

See "Proposal to Veto New Tax on Sweetened Beverages"

After the bill was vetoed, the legislature reported that "... The Economy and Bonds Commission of the National Assembly decided to pass by insistence Law 570, which creates the Action Plan to Improve Health and Establish the Selective Tax on the Consumption of Sugared Beverages and the Criteria for its use. The report will now be submitted to the plenary for its respective ratification."

Also see "Non-Alcoholic Beverages: Imports up to the First Semester"

From the National Assembly statement:

April 2, 2019. The Commission of Economy and bonds of the National Assembly decided to approve by insistence Bill 570, which creates the Action Plan to Improve Health and Establish the Selective Tax on Consumption of Sugared Beverages and Criteria for its Use. The report will now be submitted to the plenary for its respective ratification.

Read full statement (In Spanish).

 

https://www.centralamericadata.com/en/article/main/Controversy_Over_Tax_on_Sweetened_Beverages_Remains

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Tax on sugary drinks to  aid  health action plan

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Posted 19/11/2019

A law creating an  "Action Plan to improve health"  became effective on Monday, November and includes a tax on the consumption of sugary drinks and the criteria for their use.

The Official Gazette notice says  that it the tax norm will be 7% for soft drinks, 5% for other sugary drinks, of national production and 10% for imported syrups and concentrates for the production of sugary drinks. 

"The norm, which arose from the need to ensure the good health of the population, establishes the promotion of a healthy lifestyle based on healthy eating, good nutrition, and physical activities," said the norm.

It also sends public awareness about the consequences of excessive sugar use on the state of health.  It calls for corporate responsibility in order to have an optimal manufacturing process that favors responsible, balanced and sustainable consumption.

The law creates the Commission for the Improvement of Health, which is also instructed to meet at least once a month. 

Life Blends businessman Rafael Carles said that it is now up to the authorities to ensure that the taxes are collected and well used for the promotion of educational campaigns to curb the increase in non-communicable diseases, such as diabetes, hypertension, and cancer, among others.

 

https://www.newsroompanama.com/health/tax-on-sugary-drinks-to-aid-health-action-plan

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Industrialists knock sweet drinks tax

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Posted 21/11/2019

Panama’s   Union of Industrialists of Panama (SIP)  said on Thursday, November 21  that  they do not support  the approach of using tax measures  on sugary beverages that was  announced  on November 18  as part of an Action Plan to Improve Health

In a statement released on Thursday, November 21, IAPA members indicated that that, unlike what has been done in other countries in this case, it is about a measure that promotes reformulation to offer products with less caloric content to consumers.

The SIP said that “as a responsible and concerned union for the well-being and health of our population, we express our interest in collaborating with the government, civil society and other actors, through comprehensive measures that promote healthy lifestyles combined with adequate nutrition and physical activity ”.

 

https://www.newsroompanama.com/business/industrialists-knock-sweet-drinks-tax

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Sugary Beverage Tax Applicable

A law was published in the Official Journal of Panama that establishes a 7% tax on carbonated beverages, 5% for other sugary beverages and 10% for syrups, syrups and concentrates for the production of sugary beverages.

Thursday, November 21, 2019

On November 18, Law 114 was published in the Official Journal, entitled " What creates the Action Plan to Improve Health and dictates other provisions to establish the selective tax on the consumption of sugary beverages and the criteria for its use."

You may be interested in "Beverages: Consumer Trends and Preferences"

Article 9 of the aforementioned law explains that "... It establishes the selective tax on sugary beverages, which will be 7% for carbonated beverages, 5% for the rest of sugary beverages, whether domestically produced or imported, and 10% for syrups, syrups and concentrates for the production of sugary beverages.

The selective consumption tax rate of 7% for sugared beverages will also be applied to tariff item 22.02.

Foods based on dairy products, grains or cereals, nectars, fruit juices, vegetables with natural fruit concentrates and their concentrates and those products in general whose grammage is less than 7.5 grams of sugar per 100 ml of sweetened beverage will be exempt from the selective tax on consumption of sugary beverages."

Rafael Carles, a Life Blends businessman, told Prensa.com that "... it is now up to the authorities to ensure that the taxes that are going to be collected are well used for the promotion of educational campaigns to curb the increase in non-communicable diseases, such as diabetes, hypertension, cancer, among others.
"

See full publication (in Spanish).

 

https://www.centralamericadata.com/en/article/main/Sugary_Beverage_Tax_Applicable

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Tax on Sugary Beverages Rejected

Panamanian industrialists consider that the approach under which the new tax of 7% on carbonated beverages and 5% on other sugary beverages was defined uses discriminatory fiscal measures.

Friday, November 22, 2019

On November 18, Law 114 was published in the Official Journal, entitled "What creates the Action Plan to Improve Health and dictates other provisions to establish the selective tax on the consumption of sugary beverages and the criteria for its use", which stipulates a 7% tax on carbonated beverages, 5% for other sugary beverages and 10% for syrups, and sugar concentrates for the production of sugary beverages.

You may be interested in "Beverages: Consumer Trends and Preferences"

After this provision was known, on November 21, the Union of Industrialists of Panama (SIP) through a statement stated that "... as a responsible guild and concerned about the welfare and health of our people, we express our interest in working with the government, civil society and other actors, through comprehensive measures that promote healthy lifestyles combined with adequate food and physical activity."

The document outlines that the industry does not share the approach of using discriminatory fiscal measures, but recognize that, unlike what is done in other countries in this case, it is a measure that promotes reformulation to offer products with lower calorie content to consumers.

For the industrial sector it is important to create comparative advantages with other markets and we will continue working to provide different options that meet the needs of consumers, concludes the statement.

See full law (in Spanish).

 

https://www.centralamericadata.com/en/article/main/Tax_on_Sugary_Beverages_Rejected

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