In November 2014, Berkeley, California was the first city in the US to pass a law that imposed tax on sugary drinks. More than three quarters of voters were in support of adding 1-cent-an-ounce tax on soft drinks. The law passed despite a multi-million dollar opposition campaign that was funded by soft drink manufacturers. Elsewhere, attempts to pass soda tax law failed.
In San Francisco, the proposed law would impose 2-cents-per-ounce tax but needed two-thirds majority to pass. In New York, the proposition was blocked by a New York State judge.
Although sugary drinks are already taxed in 33 states, the law passed last year in Berkeley imposes tax per ounce. Normally, you can get 24 cans (about 288 ounces) for $4, but with soda tax in place, the price you’ll pay for wanting to stock on sugar-sweetened beverages would increase by 72%.
The reason behind imposing soda tax is to solve obesity and Type-2 diabetes. In 2013, researchers in Harvard found that increasing the price of a 20-ounce soda by 20 cents led to sales drops of about 16%. That said, will imposing a soda tax really lessen consumption and improve health?
List of Pros of Soda Tax
1. It is aimed at reducing consumption.
As mentioned earlier, a study by Harvard researchers claimed that increasing soda prices led to lesser purchases of the said beverage. Berkeley was quick to act and proposed a soda tax which passed.
2. It is meant to improve health.
Obesity and diabetes are huge health concerns in the US, and some suggest that it is linked to soda consumption. So, imposing tax on a favorite drink might make people want to consume it less.
Figures suggest that if soda tax hits the national stage, thousands of cases of heart disease, stroke and death can be prevented.
In January 2014, Mexico has also increased prices of sodas, sugary drinks and even unhealthy snacks such as potato chips and cookies. Recently, a study by the Mexican National Institute of Public Health and the Carolina Population Center at the University of North Carolina, Chapel Hill say the tax implementation is working.
Researchers analyzed data on household consumption in 53 cities. Based on those, they found that sugary beverage consumption declined to 6% on average in 2014 compared to pre-tax trends.
List of Cons of Soda Tax
1. It isn’t really the only answer to health issues.
In the US alone, consumption has has been on the decline since 2000. However, obesity is still holding steady. Diabetes peaked in 2010 and leveled off in 2011. So, if sugary drinks are the culprits of these diseases, why are the levels still the same or somehow not declining?
The beverage industry has also objected to being singled out while other products with added sugars aren’t. The main reason lawmakers focus on sugary drinks is that they are easier to define and tax compared to other products.
2. It is a consumer rights issue.
In essence, soda tax is a sin tax. Not every American is happy with the idea of using tax to promote public health. Those who consume soda feel that they have the right to indulge in the drink and just because others can’t moderate their consumption doesn’t mean that everyone should suffer.