15/02/2017 7:01 AM AEDT | Updated 15/02/2017 7:04 AM AEDT

Junk Food Tax Would Save Australia $3bn, Boost Life Expectancy

Australian academics want junk taxed, and healthy food subsidised.

Sam Hodgson / Reuters
Australia's healthcare system would be a big winner from taxes on unhealthy food, new research shows.

Australia could save more than $3 billion in healthcare costs by levying a suite of taxes on sugar, salt, saturated fat, and soft drinks, while subsidising fresh fruit and vegetables.

That's the message from new University of Melbourne research, released on Wednesday, which forecasts that such a package would also result in an extra two years of life for all Aussies, from 2010.

The modelling, published in the the journal PLOS Medicine, estimates the nation would save $3.4 billion in healthcare costs if the ambitious raft of measures was introduced.

Lead researcher Dr Linda Cobiac said taxes on salt, saturated fat, and sugary drinks were big contributors to the big savings on healthcare.

While those taxes generated the largest health gains, the research showed there were also big healthcare benefits from implementing just a tax on sugary drinks.

"Few other public health interventions could deliver such health gains on average across the whole population," Cobiac said.

The modelling also debunked the idea that taxes on unhealthy food would unfairly hit low income earners, the research's co-author Professor Tony Blakely said.

"Critics often say taxes on unhealthy food make life tougher for low socio-economic households, but we've demonstrated that the right structuring of incentives means the financial impact on households is negligible, while their health improves," Blakely said.

He also backed the introduction of a sugar tax as a good initial step forward.

"It is a good first policy step to make, and is supported by groups such as the Medical Colleges of Australia," he added.

Nations like France, Belgium, Hungary, Finland, Chile, the UK, Ireland and South Africa have already taken action on the issue, imposing taxes on sugar.

In Australia, many health professionals support a similar move, but the federal government remains opposed, previously labeling such a proposal as a "moralistic tax".

Late last year, Nationals leader Barnaby Joyce called a mooted sugar tax a "bonkers mad" idea that would curb individual freedom and hurt the local sugar industry.

That was after the Grattan Institute urged the imposition of an excise tax of 40 cents per 100 grams of sugar on all non-alcoholic, water-based drinks with added sugar.

If imposed, the Grattan Institute said the tax would lift the price of a 2L soft drink by around 80 cents, raising about $500 million a year in extra revenue, while resulting in a 15 per cent drop in the consumption of sugary beverages.

Labor reportedly investigated the idea of a sugar tax before the 2016 federal election, while the Greens have expressed support for it.