Wisynco Group Chairman William Mahfood has mounted a strong challenge to the Government’s newly announced Special Consumption Tax (SCT) on sweetened beverages, warning that the levy could fall hardest on Jamaica’s poorest households while doing little to meaningfully reduce consumption or improve public health.

The tax, tabled on Thursday in the first sitting of the House of Representatives for the new parliamentary year as part of the Ministry Paper on Revenue Measures for 2026/2027, proposes SCT of $0.02 per millilitre on non-alcoholic sweetened beverages. The measure is expected to take effect in the first quarter of the new financial year and is projected to yield approximately $10.1 billion in revenue.

Under the proposal, the tax would apply to all non-alcoholic beverages containing added sugar or other caloric sweeteners, as well as drinks containing artificial or non-nutritive sweeteners, whether carbonated or non-carbonated, and whether produced locally or imported.

In presenting the paper to the House, Finance Minister Fayval Williams said the measure is intended to not only strengthen revenue collection but also advance public health objectives, pointing to Jamaica’s persistently high rates of obesity and diabetes.

But Mahfood, who spoke with the Jamaica Observer on Thursday, argues that the policy is neither sufficiently clear nor sufficiently fair.

“There are a few things that need to be clarified, like how this tax is to be applied? Is it applied against powdered beverages with added sugar? Is it applied against things like syrup with sugar that you add water to? Or is it just on ready-to-drink beverages? It sounds like it’s just ready-to-drink, which would make it extremely prejudicial,” he said.

He further questioned whether milk-based products containing sugar would also be captured under the new regime, suggesting that ambiguity in the definitions could create uneven treatment within the food and beverage sector.

Beyond definitions, Mahfood contends that the structure of the tax will shift the burden squarely onto consumers, particularly those with the least disposable income.

“If you’re going to take $10 billion of tax on this, against these types of products, you’re taxing the very poorest in the country. That’s who consumes the majority of these products, which means you’re going to be taking away money that they could be spending on school books, on rice and flour, and salt fish. I mean, that’s effectively what you’re doing,” he argued.

Mahfood added that the measure would be inflationary, especially coming months after Hurricane Melissa disrupted supply chains and placed pressure on household budgets.

The Government has framed the measure, in part, as a public health intervention. Williams noted that sweetened beverages are a significant source of excess sugar consumption and that any reduction in consumption resulting from price adjustments would represent a positive supplementary outcome.

Mahfood, however, rejects the argument that targeting beverages alone will address Jamaica’s health challenges.

“I think a part of the challenge is we have a very, very poor health system that is broken down and incapacitated, and what is happening is that the actual money that is being spent on health in the country has not been managed well, [and] we have not done enough in terms of health education and awareness,” he said.

“It’s not one class of products that causes people’s health. There are issues related to salt intake, there are issues related to oils and fats intake, there are issues related to all manner of cholesterol and carbohydrates, etc,” Mahfood added.

He also disputed the claim that higher prices will significantly change behaviour.

“I think it’s not a well-founded [argument], and there is no science behind it as far as going to have an impact on the reduction in consumption. Because the actual fact is that in many of the other markets around the world where they have implemented similar taxes, consumption has remained the same or gone up,” he said.

In Mexico, which introduced a peso-per-litre tax on sugary drinks in 2014, studies published in the
British Medical Journal found that purchases of taxed beverages declined by around five to seven per cent in the first two years, with larger reductions among lower-income households. However, overall calorie intake fell only modestly, and critics argue that substitution to other high-calorie products diluted the broader health impact.

In the United Kingdom, the 2018 Soft Drinks Industry Levy prompted many manufacturers to reformulate products to reduce sugar content. While sugar levels in soft drinks fell significantly, overall sales volumes of soft drinks did not collapse, suggesting that consumption patterns adapted rather than disappeared.

The sweetened beverage tax is not an entirely new concept in Jamaica’s policy discussions. In 2018, Health and Wellness Minister Dr Christopher Tufton publicly indicated that the Government was examining the possibility of introducing a tax on sugar-sweetened beverages as part of efforts to combat rising obesity and other non-communicable diseases. The proposal, however, was not pursued at the time, following consultations and concerns raised by members of the private sector about its economic impact and effectiveness. Since then, the concept has periodically re-emerged in public health discussions as Jamaica continues to grapple with high rates of diabetes, hypertension, and obesity.

Opposition Spokesman on Finance Julian Robinson, speaking in the House after the finance minister’s presentation, signalled cautious support for the public health objective but expressed doubt about the scale of behavioural change.

“In relation to the special consumption tax on non-alcoholic sweet drinks, I know there is a public health imperative, a very big one. But I will say to you, I do not believe the price increases will change the world,” Robinson said.

He argued that demand for such products is relatively inelastic, particularly among young consumers, and recommended that a portion of the anticipated revenue be directed towards supporting local agriculture and healthier alternatives.

He suggested that some of the projected $10 billion should be invested in expanding the production and distribution of locally made natural juices so that they become viable and affordable substitutes for imported or highly sweetened drinks.

Robinson maintained that the funds should not simply flow into the Consolidated Fund, but instead be used to strengthen domestic farming and agro-processing to create sustainable alternatives.