Poland introduces surcharge on sugary and alcoholic drinks – but government denies it is a tax

An additional charge will be added to the cost of sugary and alcoholic drinks in Poland from the start of next year, after President Andrzej Duda signed the relevant legislation into law.

The measure was proposed by the government late last year, with the aim of “promoting healthy consumer choices” by “using fiscal policy as a tool to combat overweightness and obesity”.

However, it has faced criticism from some quarters, in particular because it appears to break a pledge by the ruling party and president not to raise taxes. In its defence, the government has argued that the additional charges – which it expects to bring in 3 billion zloty (€684 million) annually – are technically a “surcharge” rather than a “tax”.

How will it work?

The new fees will add a fixed 0.50 zloty (€0.11) to the cost of 1 litre of drink containing sugar or sweeteners. There will also be an additional variable charge of 0.05 zloty per litre for each gram of sugar above 5g/100ml. Cola, for example, normally has around 10 grams of sugar per 100 millilitres.

The change would mean the average prices of sweetened beverages rising around 26%, according to calculations by news website Gazeta.pl

Meanwhile, alcoholic drinks sold in bottles of under 300 millilitres will have an additional charge of 25 zloty per litre of alcohol content. This means that, for example, that a 100 millilitre bottle of vodka with an alcohol content of 40% would become 1 zloty more expensive.

The reason for only targeting small bottle of alcoholic beverages – known colloquially as małpki (monkeys) in Polish – is that they are seen as a particular danger to the health of young people and the heaviest drinkers.

There will also be an additional 0.10 zloty per litre charge for beverages containing caffeine and/or taurine, which are commonly found in energy drinks.

A “tax” or a “surcharge”?

The president and government have faced some criticism, in particular from libertarian circles, for introducing the new charges despite promising not to raise any taxes.

During his recent successful re-election campaign, Duda was hailed as “the guarantor of no tax rises” by Prime Minister Mateusz Morawiecki at a campaign rally.

After Duda this week signed the legislation, Sławomir Mentzen – deputy leader of the libertarian KORWiN party, which sits in parliament as part of the far-right Confederation (Konfederacja) alliance – recalled such promises and declared that “we are ruled by liars and frauds”.

However, in response to the criticism, deputy finance minister Piotr Patkowski insisted, during an interview with Radio Zet, that the new fee is “a surcharge [opłata], not a tax [podatek]”.

This is because, he explained, the additional charges “will not be transferred to the state budget, but to the budget of the National Health Fund”, which is responsible for financing public healthcare in Poland.

In actual fact, while the vast majority of the new charges on non-alcoholic drinks will indeed be transferred to the National Health Fund (NFZ), 3.5% of the income will be spent on enforcement of the tax via the state budget.

Meanwhile, the new revenue generated from alcoholic drinks will be split 50-50 between the NFZ and the local authority where the sale takes place, rendering the finance ministry’s claims even more questionable.

Tackling health problems

When first unveiled in December 2019, the health ministry justified the tax by saying that “chronic non-communicable diseases, including diabetes and obesity, pose a serious challenge to public health”.

It is therefore important to “eliminate or significantly reduce the consumption of sweetened drinks and flavoured waters”.

Poland ranks above the European average for obesity and overweightness, according to international studies. EU data from 2014 shows 64.1% of adults in Poland being overweight, compared to an average of 59.1% across all member states.

Among children, Poland has one of Europe’s fastest-growing rates of obesity, according to World Health Organisation data. Almost 30% of Polish boys aged 11-15 and 14% of girls are overweight.

The ministry also hopes that increasing the price of small bottles of alcohol will tackle problematic drinking among the young and those who are alcohol dependent. Small bottles of vodka now make up a third of sales of the spirit in Poland.

Such drinks have created completely new behaviours among drinkers, and especially women, said Krzysztof Brzózka, the former head of the state agency for tackling alcohol problems, in an interview with Gazeta Wyborcza.

“A woman drinking vodka was considered something bad,” says Brzózka, so “small-capacity [bottles] were invented to drawn them into drinking”. The vodka, which is often fruit-flavoured, “can easily be put into a handbag, where it cannot be seen”.

Main image credit: PxHere (under public domain)

Maria Wilczek

Maria Wilczek is deputy editor of Notes from Poland. She is a regular writer for The Times, The Economist and Al Jazeera English, and has also featured in Foreign Policy, Politico Europe, The Spectator and Gazeta Wyborcza.