Taxing sugar sweetened beverages in Indonesia: Projections of demand change and fiscal revenue.

The global trend of diets high in sugar sweetened beverages (SSB) is associated with a high risk of obesity and non-communicable diseases (NCDs). To reduce SSB consumption on a population level, SSB taxes have become a popular policy solution. In Indonesia, although the prevalence of obesity has doubled in the past decade (11.7% in 2010 to 21.8% in 2018), SSB taxes have not yet been implemented. Utilizing the 2021 Indonesian household socioeconomic survey (SUSENAS), this study estimated price elasticities and projected the plausible effects of implementing an SSB tax on consumers' demand for SSBs and the associated government revenue using the Quadratic Almost Ideal Demand System (QUAIDS) model. Five SSB groups were studied: 1) manufactured liquid milk; 2) sweetened condense milk; 3) instant coffee; 4) tea drinks and fizzy drinks with CO2; 5) fruit juices, "health" drinks, and energy drinks. The overall results showed that the non-milk SSB groups were price elastic. Probing deeper into the substitutions for SSB across categories, we found both substitutionary and complementary effects. Our analysis revealed that increasing SSB prices by 20% would reduce the demand for SSBs on average by 17.5% (14.3%-18.6% for each SSB group) and generate additional state revenue up to IDR 3,628.3 billion per year (approximately US$ 238.5 million or 0.2% of total tax revenue in 2022). Considering the health and economic impacts of high consumption of SSBs, this study provides empirical evidence that imposing taxes on SSBs could be an effective measure to reduce public consumption and to generate tax revenue for financing health programs that address obesity and NCDs in Indonesia.

The advocacy coalition of sugar-sweetened beverage taxes in Indonesia.

The Ministry of Finance of Indonesia has put sugar-sweetened beverages (SSBs) taxation on its agenda since 2020 to address the need for health financing, as outlined in the National Medium-Term Development Plan for 2020-2024. However, the adoption process of this fiscal policy has been slow. This study aims to generate insights into the actors involved in the discourse of SSB tax adoption in Indonesia to inform their advocacy and communication efforts using the Advocacy Coalition Framework and Discourse Network Analysis. The analysis was conducted using data extracted from 1733 statements collected from 200 online web domains and subdomains, divided into three timeframes of the policy process. The analysis identified actors supporting and opposing the adoption of SSB tax. The discourse network also identified key advocacy coalitions and organisations in the discussion on SSB tax adoption in Indonesia. The results indicate that there are diverse network patterns in each timeframe and reveal the process and focus of the policy change. The Ministry of Finance had the most significant influence on the discourse, with actors from civil society organisations and universities involved in the process of policy change through evidence-based policy recommendations. Meanwhile, economic actors contributed to the debate on the potential harm of tax adoption to the industry. These findings can inform the policy process and ensure the successful adoption of the SSB tax in Indonesia.