As provided in the article “Mexico urged to double tax on sugary drinks”, a campaign has been held for cutting obesity and raising revenue under the urge of doubling the tax. Mexico was found placing a surcharge of 10 per cent on sugary beverages prior three years for combatting the epidemic of diabetes and obesity. It has been recommended by the World Health Organization that increased tax on sugary beverages is crucial for the reduction of obesity during childhood. It had been depicted by a research of British Medical Journal that the consumption of fizzy drinks across Mexico dropped in the initial year of taxation (Bloom, 2014). The data of Euro-monitor provided evidence that the people of Mexico, on an average, consumed 132.9 litres of sugary beverage in the year 2015 when compared to 139.4 litres in the year 2013. On the other hand, while taxes were also raised in Chile, the intake appeared to maintain steadiness 140.4 litres per capita in the previous year.
Even though there has been a growth in the sale of bottled water across Mexico where a number of public supplies are distrusted, a large population of Mexico states to be exclusive reliability upon carbonated drinks for the purpose of hydration. Sugary beverages can be classified as normal goods. However, normal goods have several categories as well and one such category is a demerit good. A demerit good is that good which is not beneficial for the health of the public but the public lacks awareness of these negative traits of the product. People tend to be lacking awareness about the personal costs involved in the consumption of sugar (Bloom, 2014). In the alternate sense, individuals tend to have awareness about the negative effects of sugar but end up struggling a lot for reducing consumption due to its qualities of addiction. The absence of awareness regarding sugar and related products is a clear evidence for the failure in providing information that may affect the effectiveness delivered in increasing the taxes.