December 11, 2015

Coca-Cola India Says May Have to Shut Factories If New Sin Tax Passed

Coca-Cola India said on Friday it may have to close some bottling plants if the government pushes through a proposal that would subject fizzy drinks to a 40 percent "sin" tax, as part of a broader fiscal overhaul.

"It will lead to a sharp decline in consumer purchase," Coca-Cola India said in a statement. "In these circumstances, we will have no option but to consider shutting down certain factories."

The ruling BJP is trying to push a national goods and services tax (GST) through Parliament that would replace a myriad of state sales taxes and shake-up government revenue.

Several countries are debating so-called "sugar taxes" to tackle obesity and encourage healthier lifestyles. While more than a fifth of India's population lives below the official poverty line, the country is home to the third-highest population of obese people after the United States and China.

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