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Updated: Jul 13, 2025
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Association Between a State-Level Fat Tax and Fast Food Purchases
Sumit Agarwal1, Pulak Ghosh2, Changwei Zhan3
1NUS Business School, National University of Singapore (NUS), Singapore.
JAMA Network Open
|October 16, 2023
Summary
Kerala
Area of Science:
- Public Health
- Health Economics
- Nutritional Science
Background:
- India is experiencing a rise in obesity, prompting public health interventions.
- Kerala implemented a fat tax on unhealthy foods, which was later nullified.
Purpose of the Study:
- To assess the impact of a state-level fat tax on fast food consumption in Kerala, India.
Main Methods:
- A cohort study analyzed credit and debit card transactions from 2016-2017.
- The difference-in-differences method compared fast food purchases in Kerala to 9 other Indian cities.
- Data included over 238,000 accounts, aggregated at the account-year-month level.
Main Results:
- During the fat tax period, Kerala's fast food purchase ratio decreased by 3.9 percentage points compared to control cities.
- After the tax was nullified, the ratio further decreased by 5.6 percentage points relative to the pre-tax period.
Conclusions:
- The Kerala fat tax was associated with a reduction in fast food purchases.
- Future food tax policies require careful design, considering social and nutritional implications.
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