According to Wang, Coxson, Shen, Goldman & Bibbins-Domingo (2012), sugar-sweetened beverages are the main contributors to the U.S. obesity epidemic, and the authors estimate that a national excise tax of one penny per ounce on sugary beverages would reduce adult consumption by 15%. Over a period of 10 years, this would prevent 2.4 million diabetes person-years, 95,000 heart attacks, 8,000 strokes, and 26,000 premature deaths, while saving an estimated $17 billion in medical costs. This tax would generate $13 billion annually, which could fund public health programs (Wang et al., 2012).
Connecticut Democratic Representative Rosa DeLauro proposed the Sugar-Sweetened Beverages Act of 2014, the SWEET act. After its introduction in 2014, it stalled in Congress and was reintroduced in March, 2015. To date it has not made progress (TheHill, 2015).
Fifteen US states have unsuccessfully discussed proposing a soda tax in recent years. In November of 2014, Berkeley, CA was the first city in the nation to pass a “soda tax” law, Measure D, which adds a 1 cent per ounce excise tax to beverages with added sugar. Berkeley City Council members announced that the March, 2015 revenue from the soda tax was $116,000, and they project revenue for the first year to be $1.2 million. These funds will be used for health-related community programs and programs for the prevention of obesity and diabetes in children (Koshino, 2015).
While the discussion about soda taxes continues in the U.S.., data is coming in from Mexico, which started taxing sugary beverages and junk foods, such as chips, cookies, candy, and ice cream nationally, effective January 2014. Purchases of sugary beverages in Mexico, declined by an average of at least six percent with a tax of only 10%, compared to Berkeley’s 20% tax. Interestingly, bottled water sales in Mexico went up, as soda sales declined. Mexico is now discussing an increase of their soda tax from 10% to 20% and removing sales tax from bottled water (Wade, 2015).
We know that soda taxes reduce consumption, as we now have evidence from Mexico. Berkeley’s program is too new to generate much useful data beyond revenue data at this point. Until we have a nationally enforced soda tax, Berkeley residents can purchase sugary beverages just outside of Berkeley. To date, we can’t prove that an excise soda tax will decrease incidence and prevalence of obesity and diabetes in the U.S. The study by Wang, at al., (2012) gives us an informed prediction/estimation of what the results of a soda tax in the U.S. could be, but until we have a national soda tax and generate our own data, we don’t know for sure what the health impact will be. If consumers of sugar sweetened beverages switch to beverages with artificial sweeteners, which would not be subject to excise tax, what would the health impact of increased consumption of diet sodas be? Will consumers of sugary beverages in the U.S. switch to diet sodas, water, juice, or will they just pay the price and continue to drink their sodas? We don’t know.
We can keep an eye on Mexico and see how it goes, and so far the data from Mexico is promising, or we can pass the SWEET act, and if nothing else, generate a tax revenue of $13 billion annually (Wang, et al., 2012) for public health programs for the prevention, treatment, and research of diet-related health conditions (TheHill, 2015). Perhaps bottled water could become tax exempt and more affordable, and access to high quality drinking water could be ensured everywhere in the U.S.
Several decades ago, the U.S. led the way, reducing smoking and its devastating health consequences, by taxing tobacco. Many countries in the world followed the example of the U.S. This time, Mexico leads the way. Will the U.S. follow?
Koshino, Y. (2015). 1st month of Berkeley 'soda tax' sees $116,000 in revenue | The Daily Californian. The Daily Californian. Retrieved 23 August 2015, from http://www.dailycal.org/2015/05/19/1st-month-of-berkeley-soda-tax-sees-116000-in-revenue/
TheHill,. (2015). Congress is letting the SWEET Act go sour. Retrieved 24 August 2015, from http://thehill.com/blogs/pundits-blog/healthcare/247327-congress-is-letting-the-sweet-act-go-sour
Wade, L. (2015). Mexico's Soda Tax Is Working. The US Should Learn From It.. Wired.com. Retrieved 23 August 2015, from http://www.ucsf.edu/news/2012/01/11267/how-many-lives-could-soda-tax-save
Wang, Y., Coxson, P., Shen, Y., Goldman, L., & Bibbins-Domingo, K. (2012). A Penny-Per-Ounce Tax On Sugar-Sweetened Beverages Would Cut Health And Cost Burdens Of Diabetes. Health Affairs, 31(1), 199-207. doi:10.1377/hlthaff.2011.0410