Did the junk food tax make the Hungarians eat healthier?

Abstract

I analyse whether the introduction of the unhealthy food tax lead to significant improvements in the dietary habits of the Hungarian population. I focus on the consumption of processed and unprocessed food before and after the tax was levied on a range of food high in salt and sugar. Using data from a large scale household panel data set, I estimate the consumed quantities of processed food to decrease by 3.4% due to the unhealthy food tax, while the consumed quantities of unprocessed food increased by 1.1%. The lowest income groups were the most responsive to the introduction of the tax. Despite data limitations, the results indicate moderate improvement in population diet that is likely to be attributable to the tax.