Sri Lanka’s much-publicized campaign to reduce sugar consumption and combat non-communicable diseases (NCDs) is facing growing scrutiny, as emerging evidence suggests that major policy gaps are weakening its intended public health impact.
The government’s twin strategy imposing taxes on sugar-sweetened beverages (SSBs) and introducing Traffic Light Labelling (TLL) has been widely praised as a progressive step toward healthier consumer choices. However, recent findings from the Institute of Policy Studies of Sri Lanka (IPS) reveal that significant regulatory blind spots and industry adaptations may be undermining the effectiveness of these measures.
On the surface, the Traffic Light Labelling system appears successful. Surveys indicate that nearly two-thirds of Sri Lankan consumers understand the colour-coded labels, while a 10 percent increase in beverage prices has been linked to a 15 percent decline in the demand for carbonated soft drinks. Yet researchers warn that these achievements conceal a much deeper problem.
According to available data, nearly 75 percent of sweetened beverages consumed across the country remain outside the current regulatory framework. Health Ministry sources point out that the poorest 40 percent of households obtain as much as 85 percent of their sweetened drinks from informal markets, loose-sugar beverage dispensers and milk-based products that are exempt from traffic-light labelling requirements.
As a result, low-income consumers continue to purchase inexpensive, high-sugar products that carry no warning labels, increasing their vulnerability to obesity, diabetes and other NCDs. Public health experts argue that the current system has unintentionally widened health inequalities rather than reducing them.
Even more concerning is the beverage industry’s growing reliance on non-sugar sweeteners (NSS) to avoid taxation. To escape the sugar tax imposed on excess sugar content, many manufacturers have quietly reformulated products using artificial sweeteners. Since the Traffic Light Labelling criteria assess only free sugar levels, these beverages often receive favourable “Green” or “Amber” ratings despite containing synthetic substitutes.
Independent assessments have found that around 70 percent of beverages carrying green labels and half of those displaying amber labels now contain non-sugar sweeteners. This has raised concerns among health professionals, particularly in light of warnings from the World Health Organization (WHO), which has highlighted potential links between long-term NSS consumption and increased risks of cardiovascular disease, diabetes and overall mortality.
Critics also point to the influence of industry lobbying. Historical policy revisions reportedly reduced sugar tax rates by approximately 40 percent, while aggressive promotional discounts continue to soften the financial burden on consumers. Together, these factors have weakened the deterrent effect originally intended by policymakers.
Tax specialists and health advocates are now urging the government to adopt a broader nutritional strategy. Recommendations include extending taxation to beverages containing artificial sweeteners, introducing volume-based taxes, and automatically adjusting tax thresholds to keep pace with inflation.
Without decisive reforms, experts warn that Sri Lanka risks replacing one public health crisis with another substituting excessive sugar consumption with growing dependence on synthetic sweeteners while failing to achieve its long-term health objectives
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