New research conducted by the University of Waterloo in Canada showed that an excise levy on companies that produce sugary drinks can minimise death, disability, and healthcare costs.

The study revealed that over the next 25 years, a 20% excise levy on manufacturers of sugary drinks will result in more than 13,000 lives saved, preventing more than 600,000 cases of obesity and ischemic heart disease, around 200,000 cases of type 2 diabetes, 20,000 cases of cancer, and more than 8,000 strokes.

The 20% levy will also account for $11.5bn in healthcare savings and government revenue of $43.6bn, over the coming 25 years.

It is estimated that there will be a direct benefit of approximately 500,000 disability-adjusted life years in the country, if a similar levy was implemented by the federal government.

"A Canadian tax on sugary drinks has the potential to reduce the prevalence of obesity and to improve the health of Canadians."

The University of Waterloo's School of Public Health & Health Systems associate professor Dr David Hammond said: "A Canadian tax on sugary drinks has the potential to reduce the prevalence of obesity and to improve the health of Canadians, while providing substantial revenue to support other public health measures."

A number of previous studies also indicated that a levy on sugary beverages reduces consumption.  

Countries such as Mexico, France, Hungary, Finland, Norway, Belgium, Chile, Barbados, and various jurisdictions in the US claimed to have successfully implemented the levy.

The Canadian Federal Government has received propositions from multiple health organisations for an excise levy on sugary drinks.