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Tens of billions go to waste: the state's own goal - voila! Of money


The abolition of the tax on sugary drinks brought the issue of obesity back to the agenda, and with it the economic aspect. Israelis want to lose weight, and spend quite a lot on it. all the details

Smotrich at the beginning of his faction's meeting: "The decisions of the outgoing government led to an increase in prices" (Knesset Channel)

The Society for Obesity Research and Treatment stated that obesity is a chronic disease, from which approximately 4,000 Israelis die each year, but it is not just a health hazard.

Against the background of the expected cancellation of the tax on sugary drinks, new data from the Health Consumer Forum, which are published exclusively in Vala!

money, reveal the extent of the Israelis' financial investment in order to fight the phenomenon of obesity.

What is the cumulative amount that an average Israeli will spend during his lifetime on attempts to lose weight?

What is the extent of the damage to the Israeli economy due to obesity and who cuts the coupon?

Obesity is a chronic disease that empties the public purse

A comprehensive report, reflecting the state of obesity in the State of Israel, was recently published, from which an alarming picture is drawn: obesity shortens life expectancy by 3.2 years and costs the state more than NIS 20 billion per year. For the purpose of comparison, the entire defense budget of the State of Israel In the past year it stood at about NIS 60 billion.Smotrich

's first decision: canceling the tax on sugary drinks

Will Smotrich prevent the spike in milk prices?

Are you sure lowering the tax is a good idea?

As finance minister it will not pay off.

Bezalel Smotrich (photo: Rafi Ben Hakon, editor-in-chief)

The author of the report, health economist Prof. Gabi Ben-Non, noted that obesity is also a heavy economic burden for the country. Ehud Abrahamson, an expert on sugar and carbohydrate detoxification, notes that the additional cost to the national expenditure on health as a result of obesity and its complications is NIS 10.1 billion per year The damage to productivity, as a result of obesity, adds another NIS 10.1 billion a year. Hence, the total annual cost of the obesity disease is NIS 20.2 billion, which is 1.4% of GNP.

The annual global cost of the problem: more than the combined fortunes of Elon Musk and Jeff Bezos combined

The developed countries spend about 425 billion dollars a year on health care related to excess weight.

from a burden that is predicted to become more burdensome from year to year.

Experts in the field of health economic policy point out that according to estimates, overweight and obesity will deduct about 3.3% of the global GDP, or 860 dollars per person per year.

In other words: the economic damage exceeds in its dimensions the damage from the warming of the climate by one degree Celsius.

Additional damage of hundreds of millions of shekels

64% of the adult population in Israel lives with excess weight, according to a report by the World Health Organization.

From a list of 44 countries in Europe and Asia - Israel ranks third, with over half of the population in the country having a body mass (BMI) higher than 25.

Ehud Abrahamson, one of the leading experts in Israel in the field of detoxing from sugar and carbohydrates, points out that obesity is considered the cause of at least 13 different types of cancer and according to the World Health Organization, it is likely to be directly responsible for about 200,000 new cancer cases diagnosed every year throughout Europe, when This is expected to increase further in the coming years.

The costs derived from this disease reach billions of dollars in Europe every year, while estimates are that in Israel, their aggregate economic damage reaches hundreds of millions of shekels.

In view of the importance of the issue, it was placed as a priority in the European work plan of the World Health Organization for the years 2020-2025.

The governments did not allocate money and the Israelis continue to consume sugar (Photo: ShutterStock)

And what will we do in Israel?

Weaning off sugar and carbohydrates is the easiest and healthiest way to diet, but over the years Israeli governments have allocated esoteric sums of money to raise awareness of the issue and have not made it a national priority.

The attempt that was made to reduce the consumption of soft drinks by raising the tax became a political controversy, so much so that the new Minister of Finance, Bezalel Smotrich, boasted that the abolition of the tax was the first decision he made in his high office.

What is the cost to the state?

The direct cost is estimated at close to NIS 400 million.

To calculate the indirect cost, you have to go to billions, not to mention the pain and suffering.

Obesity is a chronic disease that affects more low socioeconomic status

Attorney Amy Palmer, former Director General of the Ministry of Justice, who also took part in compiling the report, wrote that "obesity is a sign of inequality.

In the State of Israel, obesity is more common among populations of low socioeconomic status, in ultra-Orthodox society and in Arab society.

The individual's ability to deal with obesity through maintaining a healthy lifestyle that includes exercise, sensible food consumption, sleep, diets, etc., requires material and cognitive resources, which exacerbate the link between inequality and obesity.

It's cheaper and faster to buy processed food, it's more accessible to get nutritional advice in the center compared to the periphery, exercise takes time and money."

Obesity also has taxing aspects

According to studies conducted, the additional tax each resident pays each year in order for their government to be able to deal with the consequences of the overweight epidemic will reach $360.

The additional tax in Israel, according to estimates, comes to $450 per person per year and in the US to $1,310.

It also comes to the cost of a car - Israelis' spending on slimming products and diets

As mentioned, obesity is a chronic disease, a health hazard, but at the same time also a generator of financial expense.

According to the data of the Health Consumer Forum, people who suffer from obesity spend an average of NIS 40,000 on diets and slimming products during their lifetime.

Alongside this, quite a few testify that their expenses on the way to the desired weight amount to even double the amount.

A disease with severe effects.

Diabetes (Photo: ShutterStock)

The increase in the consumption of processed foods as well as those high in sugars is not accidental and is due to the obesity economy - a product of a deliberate effort by food companies to promote the consumption of more processed food in order to increase their sales and profits.

Another factor that affects the increase in the consumption of processed and high-sugar foods is changes in family functioning - less time for parents with the children, less organized meals and home cooking and more eating outside the home, and more consumption of easy-to-prepare processed food.

However, the problem of the one is the source of the profit of the other: the profit rate before tax of the largest food companies in the Israeli economy, on average, stands at a rate that varies between 10-12% when the total profit of these companies, for example, in 2019 (before the corona virus) was about 600 a million shekels.

In aggregate, between the years 2019-2009, the same ten companies accumulated a pre-tax profit of a total of NIS 6.6 billion in 2019 prices.

The severe economic consequences of the abolition of the sugar tax

After all, there is a direct link between the consumption of foods and drinks high in sugar - and diabetes. In the discussion held in the Knesset's health committee in December 2021 on the topic of diabetes, the Ministry of Health presented data according to which the cost of treating diabetes patients is NIS 9 billion per year for approximately 550 thousand patients in Israel.

Hanoch Barkat is a senior fellow in the Social Leadership Program at Harvard University, chairman of the Dualis Association and former CEO of the Apex Foundation, notes that the positive effect on health of reducing sugar consumption obviously also has an economic effect at the national level and significant savings in health expenses over many years.

Diabetes has serious consequences, including kidney damage requiring dialysis, blindness and limb amputation, and the treatment of chronic diseases such as heart disease also has high costs.

Preliminary studies even indicate a link between sugar consumption and Alzheimer's disease.

The effect of the obesity phenomenon on the labor market and the level of productivity in the economy

According to the assessment of the International Diabetes Federation, the forecast for 2035, taking into account the expected changes in demographics and urbanization, is a 55% increase in the incidence of diabetes and a 35% increase in expenses.

And this has weighty implications, also for the Israeli economy: alongside the direct costs, there are quite a few indirect costs, which are not felt in the health system but in other social systems.

These costs mainly relate to productivity damage due to absences from work and disability.

A review of various studies shows that the indirect costs make up 25%-64% of the total cost of the disease.

In the US, the indirect costs were estimated at about 69 billion dollars, and this was about a decade ago. Today, according to professional sources, the amount has doubled.

  • Of money

  • consumption


  • diet

Source: walla

All business articles on 2023-01-12

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