Caribbean Flavours and Fragrances (CFF) says it is lending support to manufacturers by introducing a plant-based flavouring aimed at naturally reducing the sugar content of beverages without compromising the taste of the products or the health of consumers.
Chief Executive Officer of CFF Derrick Cotterell says his company is introducing “tried and tested science” that has been around for more than 10 years, which will allow Jamaica to catch up with many other countries in the world.
“This is not at all an artificial sweetener. We are using a very small quantity of a plant-based product that mimics the sweetness of sugar, enhances flavour, while protecting the health of the consumer,” Cotterell said in an interview with the Financial Gleaner.
The Government has been urging manufacturers of soft drinks and other refreshments to lower the sugar content of their products in order to reduce obesity which gives rise to non-communicable diseases such as diabetes, or it may be forced to use taxation as a means to get compliance.
However, manufacturers and other private-sector interests are banking on the Government’s assurance that there will be no new taxes, at least for the rest of the year and hence, a levy on sugary beverages is not in the making for now.
Private Sector Organisation of Jamaica (PSOJ) President Howard Mitchell says that if the Government moves to tax sugary drinks, a number of members will be affected. He notes that a month ago, the private-sector lobby brought Health Minister Dr Christopher Tufton and industry players together in an attempt to have dialogue on the matter, emphasising that a process of engagement is the proper way to go.
“We think that there is room for constructive dialogue, and whatever decision is taken should be informed by the facts,” Mitchell said in an interview with the Financial Gleaner.
He was supported by president of the Jamaica Manufacturers’ Association (JMA), Metry Seaga, who said “the minister, when he met with us, assured us that there would be no tax on sugary drinks for this year”.
According to Seaga, a tax on sugary drinks would be problematic. “The industry is of the view that if there is a problem, then we want to be a part of the solution and, certainly, a tax is not the way to go about it.”
At the same time, CFF’s Cotterell says the possibility of a tax on sugary drinks is a reality that industry players must seek to deal with.
“To be fair to the minister, this is not something that is unique to Jamaica. Indeed, we are seeing it all over the world. Within the region and in the United Kingdom, they have put on this tax. Indeed they have gone as far as to ban certain items that have too high a sugar content,” said Cotterell, while urging compliance on the part of industry players.
“Compliance is always better than having the Government impose a tax. At CFF, as a responsible company, and with our industry partners, we want to ensure that we avoid actions which may ultimately lead to higher prices for customers,” he added.
The JMA represents the interests of several drinks manufacturers whose beverages are sold to the public through distribution channels, including supermarkets, at recreational events and schools. There has been increased concern recently that the sugar content of those products is too high, contributing to obesity which leads to diabetes, high blood pressure and other chronic non-communicable diseases.
For much of 2017, academics and government officials have been warning of the dangers. Dr Tufton, in leading a reduction in sugar content in products campaign through his ministry’s Jamaica Moves, to maintain a healthy lifestyle, warned that regulations may be used to deal with the problem.
In January 2018, Finance Minister Audley Shaw warned that the Government may use taxation as a means to keep the effects of sugary drinks in check. This has led to some disquiet in manufacturing circles, with fears that a tax would drive up costs to consumers.
Mitchell said that was one reason why the PSOJ sought to bring the parties together.
“Promises were made on both sides to have rational, transparent and open dialogue on the issue,” Mitchell said of the meeting a month ago, noting that he was satisfied with the attitudes and apparent goodwill on both sides.
He said that while the PSOJ has not heard anything further since the meeting, he knew that private-sector interests stood ready to promote a better understanding through research.
“My recollection is that there was an agreement from the minister (Dr Tufton) that they were willing to engage in such a survey and the private sector offered to fund it,” Mitchell said, noting that as far as he knows, there has not been any forward movement on the part of the Government or the potentially affected companies.
Both Mitchell and Seaga agree that dialogue is the best way forward. The JMA head says industry players will be exploring all avenues in the search for solutions.
“Our members and the main players in the industry are working very closely with the Ministry of Health and most, if not all, are reducing their levels of sugar with sugar substitutes in the first instance, or just making a reduction by making their drinks smaller or not selling into the schools and things of that nature,” Seaga said.
The PSOJ head says the Government’s commitment to not introducing any new taxes is helpful. “The minister of finance has said no new taxes (for fiscal year 2018-19), so I expect that we would certainly have the rest of the year to discuss this matter,” Mitchell said.