Tecnológico de Monterrey Campus Santa Fé EGADE Business School

Analysis of the Official Resolution to Implement the IEPS Tax, to Sugar Beverages

MOOC: Critical Thinking

Student Name: Miguel Romuroso Vargas

ID: A01335536

Due Date: November 16, 2020

Contents

1. Introduction 2

2. Arguments 2

3. Consistencies and Inconsistencies 4

4. Detected Omissions, Fallacies, False Infererieces, and Deceptive

4
Statistics

5. Causes of Obesity Analysis 5

6. Conclusion 5

7. Argument Order 5

8. References 8

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 1. Introduction

With the objective of determining the criteria, strategies and preventive activities to foment a
better environment, increase the quality of the health services and to prevent obesity and
other diseases common in mexican students. In November 2013, the mexican government
announced a new tax of 5% on junk food, sugar beverages and high calorie food as a
measure to reduce the percentage of obesity in Mexico. This decision was attached to be
not critical or logical, many other factors were forgotten when talking about the causes of a
health problem like obesity.

2. Arguments

Bellow, organized in separate boxes are the arguments or premises presented to

support the creation of this tax:

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Table 1. Tax Arguments

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 3. Consistencies and Inconsistencies

The arguments of this tax have a lot of inconsistencies, from the beginning they are
making an inconsistency of the state of the disease and the responsibility of the law and the
implications this may represent.

This tax assumes that junk food, sugar beverages are the causes of obesity and
other diseases related to it. But one of the biggest inconsistencies is the assumption that a
tax will reduce and stop the consumption of junk food, and that this will guarantee that
people will start eating healthier.

Some consistencies of this tax are the effects of obesity in the health system, a high
occupancy of hospitals, a high demand of resources to treat it and also the social, economic
and environmental problem this represents.

The call to action to take measures to prevent it is consistent, based on the logic
argument that if the problem is not treated the consequences will be severe and more
difficult to attack due lack of prevention measures.

The effects of junk food in the human body are true and the fact that they cause
some diseases like obesity are true, but this argument cannot be said in the way of saying
this is the only reason and that all the persons with this condition are because of the
consumption of junk food.

As a preventive measure this can have logic, but the assumptions to argue the
problem are inconsistent. This is an example of how some laws are made with a lack of
consistency to describe causes, problems and solutions.

4. Detected Omissions, Fallacies, False Infererieces, and Deceptive Statistics

The detected omissions, fallacies, false infererieces, and deceptive statistics in this tax can
be analyzed with the following reasons:

● Omissions: There is lack of information and there is not a reference frame to make
the assumptions this tax is taking as arguments. Although there is information with
financial numbers and statistics, this can be taken as a deceptive statistics.

● Fallacies: The causes and effects are bad relationated, some fallacies such as Ad
Ignorantiam, Petito Precipi y Ad Consequentiam. This in order to give some logic to
the premise that junk food and sugar beverages are the only cause of obesity.

● False Infererieces: The inferences that junk food and sugar beverage are the only
cause of obesity, and thus creating a tax will reduce their consumption, not
considering other factors.

● Deceptive Statistics: The representation of the disease in the statistics does not
consider other factors such as the population against the other countries or the other
preventive measures other countries have taken and their effectiveness,

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 5. Causes of Obesity Analysis

Although obesity is the first cause related to obesity due a high consumption of junk
food, sugar beverages and a food with high quantity of calories. In Mexico the consumption
of this food can be caused by other factors such as accessibility, cultural or social behavior,
lack of nutritional education, prevention programmes, lack of accessible or good substitutes
are just some causes of the problem.

Assuming an increase in the price of junk food will reduce the consumption and
prevent the problem, instead of approaching the educational factor of the society is the
problem of this tax, the consumer will see this just a small action with effects in the short
term, but not solving the roots of the problem or thinking in the long term. Why is a tax not an
effective measure to reduce consumption? When the consumer has no other options, or the
education to stop the consumption, this good becomes or it can be considered as an elastic
product, and people will buy it no matter the price.

This measure although can be considered as a preventive measure, it does not solve
any prevention when people have no other options to buy it. A reduction could have been
expected in the short term with casual consumers or small healthy trends, but seven years
later this tax was released things have not changed.

6. Conclusion

Obesity is a disease that can have different causes, among junk food is the first
cause related to this problem, before trying to make changes in the price, it is better to
understand why people are consuming that food, understand if there is enough education or
enough alternatives and support them instead of just changing the price.

Healthy snacks are the relative substitute for this kind of food but, accessibility and
the price of this products are way more expensive than junk food even with the taxes, so
why not support healthy substitutes and try to involve junk food producers to join with real
incentives and not just adding taxes to products that the people will keep buying.

Education is another important part when talking about prevention, and incour better
in developing programmes to create awareness of the problem in the consumers is way
more better than just adding a tax to junk food.

7. Argument Order

Some research made by prestige organisations, declare that it is better to focus on

education as a preventive measure and that taxes to junk food not only not solve the
problem, does not work as a preventive measure but also hurt low income families that have
no other choices to eat.

1. “One of the main avenues that schools can use to positively affect health is also one
most directly in line with every school’s mission: educating students. Nutrition and
physical activity lessons can be woven into the curriculum-in core classroom
subjects, physical education, and after-school programs-to teach skills that help
students choose and maintain healthy lifestyles. In addition to teaching
evidence-based nutrition and activity messages, school physical education should
focus on getting students engaged in high-quality and regular activity” (Harvard T.H
Chan, ​2013).

2. “Researchers and health professionals agree on the school's potential as a favorable

place for the development of interventions that involve practices and contents in PA

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 and/or NE, considering some advantages offered by this environment, for instance,
the scope of actions; the large number of students receiving the same stimulus at the
same time; the continuity of the strategies over time, due to the permanence of
children and/or adolescents in schools; and the possibility of both structural and
operational changes” (​Henrique Guerra, Cardoso da Silveira and Péricles Salvador,
2016​).

3. “High-sugar and high-fat foods are shelf-stable, making them more convenient than
food that spoils quickly and giving them a much lower price per calorie consumed.
The absence of healthy options in so-called urban food deserts means that taxing
junk food will disproportionately harm the people living there. Also, as everyone who
has bought food from a vending machine knows, the combination of accessibility and
hunger can trigger the purchase of unhealthy food” (​Shughart II, D. Thomas, 2017​).

4. “People do tend to buy more expensive, higher-quality versions of alcohol, tobacco,

and some foods as their incomes rise. The largest effect reported in our paper was
for alcohol: a household that makes 1 percent more income spends, on average,
0.31 percent more on alcohol. (For the average household, this means that if income
goes up by $428 per year, alcohol spending goes up $1.) But the quality of things like
soda and potato chips does not scale up, and so expenditures remain basically
constant regardless of income” (​Shughart II, D. Thomas, 2017​).

5. “Most of these people are low-income. When everything they are likely to buy rises in
price, they have less money for non-food purchases. This reduction in their ability to
make purchases makes them poorer. It’s what economists call an income effect. In
our study, we show that consumers will not respond to taxation on junk food by
changing behavior, which is a premise of these taxes. The only result seems to
extract more tax from those people in society that have the least options and the
hardest time making ends meet” (​D. Thomas, 2015​).

6. “With the desire to raise revenue through additional taxes, policymakers forget to
actually offer solutions, something that we should be working on. Policy has to make
it easier for grocery stores to open in low-income areas. Consumers need to learn
more about healthy diets. The most important change, however, is to simply seek
ways to include lower-income folks in the economy and raise their overall income, a
much more complex, but ultimately more important issue” (​D. Thomas, 2015​).
 
8. References

SEGOB. (2013). NORMA OFICIAL MEXICANA NOM-009-SSA2-2013, PROMOCIÓN DE LA SALUD

ESCOLAR PREFACIO. 2020, retrivered SEGOB Website:
http://dof.gob.mx/nota_detalle.php?codigo=5324923&fecha=09/12/2013

PRODECOM. ( 2013). Impuesto a bebidas saborizadas con azucares añadidas y alimentos con alta
densidad calórica.. 2020, retrivered PRODECOM Website:
https://www.gob.mx/cms/uploads/attachment/file/65261/IEPS_Bebidas_Azucaradas_y_Comida_Chat
arra.pdf

Harvard T.H Chan. (2013). School Obesity Prevention Recommendations: Complete List. 2020,
retrivered Harvard T.H Chan Website:
https://www.hsph.harvard.edu/obesity-prevention-source/obesity-prevention/schools/school-obesity-pr
evention-recommendations-read-and-print/

Henrique Guerra, Pablo. Cardoso da Silveira, Jonas Augusto. Péricles Salvador, Emanuel. (2016).
Physical activity and nutrition education at the school environment aimed at preventing childhood
obesity: evidence from systematic reviews. 2020, retrivered SciELO Website:

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https://www.scielo.br/scielo.php?pid=S0021-75572016000100015&script=sci_arttext&tlng=en

F Shughart II, William. D. Thomas, Michael. (2017). Taxes on Unhealthy Food Are Ineffective and
Hurt the Poor. 2020, retrieved Independiet Institute Website:
https://www.independent.org/news/article.asp?id=9057

D. Thomas, Michael. (2015). Junk Food Taxes Don't Work. 2020, retrieved U.S. News Website:
https://www.usnews.com/opinion/economic-intelligence/2015/03/02/taxing-junk-food-wont-curb-obesit
y-or-heart-disease

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