Experts: sugar tax would make food more expensive

For her part, Greta Ilekytė, Senior Economist at Swedbank, believes that although the tax would not raise much money for the budget, taxing added sugar would help society.

A. Bartkus: added sugar tax would make bread more expensive than sweets

A. Bartkus does not believe that such a tax on sugar would generate funds for defence or other purposes.

„I have not calculated in detail how much such a tax could generate for the budget, but it does not seem like a large sum. Therefore, I do not view this tax positively," Bartkus told Elta.

But, according to him, the added sugar tax would increase the prices not only of sweets or sugary drinks, but also of bakery and dairy products.

„If we create a sugar tax, it will not only make the sugar that people buy to put in their coffee and tea more expensive, but it will also be passed on to many products, because, let's remember, it's not just sugar in sweets, soft drinks, juices or alcohol. Sugar is also quite abundant in the same bread products, dairy products, sauces and condiments, and even non-sweet bread products such as black bread are full of it," explained the VU associate professor.

„The added sugar tax will make a lot of products more expensive indirectly“, – he stressed.

The economist doubts whether such a „sin tax“ will contribute to promoting a healthier society. It will only lead manufacturers, who do not want to raise prices too much, to replace sugar with sweeteners and preservatives, which could have an even more negative impact on the health of the Lithuanian population, he said.

„How would a producer behave in such a situation? (...) Replace sugar with a sweetener. And it will be cheaper than sugar without having to pay tax. And the result may be that the sugar tax will be collected to some extent, but a very large number of producers will change their recipes. And if we're talking about health effects, won't those sweeteners make things worse for the body," he said.

„There will be more consumption of preservatives and sweeteners. And this will not be good for health," he added.

G. Ilekytė: society would benefit from such a tax

At the same time, G. Ilekytė argues that although the tax would not generate much revenue for the budget, the initiative itself could contribute to public health.

„Those so-called „sin“ taxes, such as excise duties, pollution taxes, as well as the sugar tax, are some of the priorities that can be addressed. In any case, society would only benefit from it," she said.

On the other hand, the economist admitted, it is unlikely that such an initiative would be welcomed by the public.

„Such taxes exist in some EU countries. Estonia has also considered introducing one this year, but has postponed it somewhat. It is not the kind of tax that would raise much revenue. It may also be difficult to get public support, but it is a tax," Ilekytė told Elta.

G. Paluckas has hinted at the possibility of a „sin“ tax

Last week, the leaders of most parliamentary parties met with the President to discuss a possible defence renewal agreement. Following this meeting, Prime Minister Paluckas said that changes to existing tax rates should be considered during the spring session of the Seimas as part of the search for means to generate more defence spending. The introduction of a new sugar tax could also be considered, according to the Prime Minister.

The Prime Minister has previously referred to the idea of a "sin tax" to promote healthier and fairer diets.

The National Defence Council (NDC), which met in January, agreed to allocate 5–6% of GDP annually to the country's defence for the period 2026–2030. The additional allocations are needed to form an army division in Lithuania by 2030.

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