A report commissioned under the previous National Government has found only weak evidence a sugar tax has been effective at improving health outcomes in other countries.
The New Zealand Institute of Economic Research was commissioned by the Ministry of Health to look into the international evidence for sugar taxes. NZIER researchers reviewed 47 peer-reviewed studies and working papers from the last five years.
They said for a tax to be judged an "effective" health intervention, the tax must make the item more expensive, which must lead to less consumption of the item, reducing sugar or energy intake, lowering risk factors and thus improving health outcomes.
But while the researchers found some evidence a tax would cut sugar intake, the evidence of better health outcomes was "weak" at best, they said.
The report said while a sugar tax would probably cut demand - especially in poorer households - estimates of less sugar intake were often overstated.
A sugary drinks tax is the most likely tax on the table in New Zealand. But the reviewers found there wasn't enough evidence to judge whether sugary drink taxes in other countries had cut overall sugar intake, or if people had just swapped fizzy for other sources of sugar or calories.
But public health physician Dr Simon Thornley - who belongs to the anti-sugar group Fizz - said the report did not appear to appreciate the distinction between sugar and other energy sources, instead treating all forms of energy as equal.
Fizzy drinks are thought to be the most addictive form of sugar, and the concentrated fructose they supply is "uniquely harmful", he said.
"The epidemiological evidence is pretty clear that sugary drinks are the worst aspect of food in our food environment. So if you discourage sugary drinks, then whatever else you might replace that with is likely to improve your health."
Thornley agreed with the researchers that there was not yet strong evidence that a sugar tax improved health - but there was evidence it led to people buying less sugar. Countries that had enacted a sugary drinks tax had seen "substantial" declines of 12-20 per cent in sugary drinks purchased, Thornley said.
He believed in a decade or more there would be much stronger evidence that sugar taxes in those countries had improved people's health.
Health Minister David Clark said while there was too much sugar in New Zealanders' diets, and that needed to change, "we have no immediate plans for a sugar tax".
"Instead we are looking at ways to reduce the amount of sugar in processed food and drink, and to develop a better labelling system. I expect business and government to work together on this issue."
Clark plans to meet with the food industry and ask how they intend to reduce sugar levels in food and drink.
"I want the industry to step up rather than have the Government immediately step in and regulate. However, if there is not sufficient progress we would need to look at other options."
Ministry of Health withheld sugar tax report
The NZIER's report was published in August 2017 but has only been publicly released this week in response to an Official Information Act request from another think tank, the right-wing New Zealand Initiative, which opposes a sugar tax.
NZI chief economist Eric Crampton said he first put in an OIA request to the Ministry of Health in October last year but it had only been released at the end of January after a complaint to the Ombudsman.
A Ministry of Health spokesman said the ministry had not released the report earlier because it "needed time to brief the incoming Government".
The MoH was "committed to improving the overall health of New Zealanders and reducing sugar consumption is just one way everyone can achieve that goal", he said.
"The ministry recommends people choose whole and less processed foods and drinks such as vegetables and fruit and plain, reduced-fat milk or water, and choose foods that are lower in saturated fat, salt and sugar."
The NZI and the Taxpayer's Union have praised the report's findings, saying they back up the 2016 NZI Health of the State report arguing there was not robust evidence to show a sugar tax would cut obesity.