A tax on soda and other sugar-sweetened beverages would not only raise money… (Emile Wamsteker / Bloomberg )
The soda tax is back on the table, and this time proponents say that a tax of a penny per ounce of sugar-sweetened beverage would not only raise $13 billion a year but also save $17 billion in medical costs by reducing the incidence of heart disease and diabetes.
These figures, published Monday in the journal Health Affairs, are based on some facts and several assumptions.
First, the facts: Americans drank 13.8 billion gallons of soda, punch, sports drinks, sweet tea and other high-calorie, nutrient-free beverages in 2009, according to industry data. That works out to about 70,000 calories per person. The sugar in all this “liquid candy,” as it is often called, is considered to be a major contributing factor to the obesity crisis, which in turn has fueled the rise of Type 2 diabetes and other diseases.
Now for the assumptions: Based on previous studies by economists, the authors of the Health Affairs study assumed that a penny-per-ounce tax would reduce soda consumption by 15%. They also assumed that 40% of the calories saved by drinking less soda would be replaced by drinking more milk and juice.
Putting it all together, the study authors from Columbia University, UC San Francisco and Virginia Tech calculated that their hypothetical tax would result in the average U.S. adult, age 25 to 64, consuming 9 fewer calories per day. Over time, that would result in enough weight loss to reduce the number of obese adults by 867,000 in 10 years.
The researchers also used models to predict that the reduced consumption of sugar-sweetened beverages would prevent 2.6% of new cases of diabetes. Over a 10-year period, those reductions in obesity and diabetes would translate into “95,000 fewer instances of coronary heart disease, 8,000 fewer strokes, 26,000 fewer premature deaths, and more than $17 billion in savings from medical expenditures averted across the U.S. population,” according to the study.
With projected benefits like these, it’s easy to see why doctors, public health experts and policymakers are so taken by the idea of a soda tax. But political support for such a measure is weak at best. Libertarians, soda addicts and anti-tax crusaders recoil at the idea that they can’t be trusted to decide for themselves what to drink.
Arguably, however, they can’t. Sure, a soda now and then may be a legitimate treat, especially if you’re the type of person who otherwise follows a sensible diet and gets regular exercise. However, the numbers clearly show that Americans as a whole aren’t just treating themselves now and then.
More to the point, there are costs associated with these decisions that aren’t reflected in the price one pays for a soft drink. The penny-per-ounce tax would go a long way toward fixing that, the authors of the Health Affairs study say.
What’s still missing is hard evidence that raising the price of sugar-sweetened beverages really will prompt people to make healthier choices. Studies have found that higher taxes on sodas (usually in the form of sales taxes, not sin taxes) do reduce consumption, but not by enough to make substantial reductions in body mass index. Perhaps the taxes in place now are simply too low to make a difference. (Tobacco taxes, which are credited with reducing reducing smoking rates, are much higher.)
The soda-tax idea isn’t going away. Perhaps someday a pioneering state will implement one that’s big enough to put all these ideas to a real-world test.
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