A Greens proposal for a 20 per cent "sugar tax" on soft drinks and fruit juices has been welcomed by health authorities who say it's a step forward in tackling Australia's obesity crisis.
Health groups say the nation's children are getting fatter and will die younger and a sugar tax could raise funds for a plan to trim down the problem.
But the proposal announced on Wednesday has been rejected by the Turnbull government, while the Labor party has refused to give its support.
Greens leader Richard Di Natale says with one in three children classified as obese, life expectancy for the next generation will go backwards.
"When it comes to sugary drinks, that is a major contributor to the obesity crisis that we have," he told reporters in Sydney at the Obesity Australia summit.
"We know that a small increase in the price of these drinks will decrease consumption and reduce the incidence of diabetes, heart disease and strokes."
Senator Di Natale said the tax would also give drink companies an incentive to reduce the amount of sugar in their products.
Sugary drink taxes have been introduced in several countries including the United Kingdom and France.
Academic research quoted by the Greens shows a 20 per cent sugary drink tax would save 1600 lives and the health system up to $609 million over twenty years.
A recent study found 30 per cent of added sugar consumed by Australians comes from sugary drinks, and modelling suggests a tax would reduce this by 12 per cent.
The National Heart Foundation said Australia needed a policy that was a "game changer" to address obesity and called on all political parties to step up.
Australian Medical Association president Michael Gannon said sugary drinks are part of the growing obesity problem, the number one health epidemic facing the country.
The World Health Organisation has recommended sugary drink taxes and celebrity chef Jamie Oliver has campaigned for Australia to introduce the measure.
Finance Minister Mathias Cormann has rejected the concept outright.
Labor frontbencher Katy Gallagher said a range of interventions was needed and a sugar tax was not Labor policy at this point, she told reporters.
The Australasian Association of Convenience Stores has also spoken out against the proposal.
"An educational, not emotional, approach is the only way to achieve better health outcomes," the group said in a statement.