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Soda Tax

To combat the global obesity and diabetes pandemics, some policymakers and public-health advocates are calling for taxes on sugary beverages to curb consumption and to reinvest in healthcare services that offset their effects.

They now have a powerful new ally in the battle with Big Soda: the World Health Organization (WHO).

In January Michael Bloomberg, the WHO’s Global Ambassador for Noncommunicable Diseases, announced the formation of a task force to investigate how countries can leverage tax policy to reduce the consumption of sugary drinks. This could, by extension, prevent diabetes, cardiovascular disease, cancer, and other chronic diseases that have been linked to those beverages.

“We have strong evidence from around the world that raising taxes on products like tobacco, sugar-sweetened beverages, and alcohol is highly effective at reducing harmful consumption and saving lives,” says former U.S. Treasury Secretary Lawrence Summers, who co-chairs the task force with Bloomberg.

Mexico, Hungary, and several other countries have already levied soda taxes, and a handful of U.S. cities, including Berkeley, Philadelphia, and Seattle, have followed suit.

Excise taxes are designed to motivate manufacturers to raise their base prices, ultimately discouraging consumers from buying sweet drinks. Such a tax could support health-promoting programs; in Philadelphia, for instance, soda-tax revenue funds parks and preschool programs.

Cities that have enacted such taxes have seen promising trends. One year after the Berkeley tax took effect in March 2015, sales of sugar-sweetened beverages (or SSBs, which include soda, fruit -juices, and energy drinks) had dropped by 9.6 percent, according to an opinion piece published in the Journal of the American Medical Association. 

But waging this battle with Big Soda in isolated cities is costly, time consuming, and less effective than potential federal tax policies hailed by the WHO.

Figures from Mexico tell a compelling story: SSB sales decreased by 5.5 percent during the first year of the tax, followed by a sustained 9.7 percent decline in year two. And while it’s tricky to tie that data to improved health outcomes, lead author Lisa Powell, PhD, points to a concurrent 16.2 percent increase in bottled-water purchases as evidence that consumers are switching to healthier choices. These changes were greatest in low- and middle-income areas, where residents are disproportionately afflicted with chronic diseases.

Despite the Journal’s call for a similar nationwide soda tax in the United States in its January 2018 issue, it wouldn’t be a quick fix. SSB consumption has declined among Americans over the past 10 years, but obesity rates have continued to rise. This suggests that a soda tax would need to be one step in a larger public-health campaign to reduce the incidence of chronic diseases. Eventually, that tax revenue could support public-health programs, subsidies to reduce the cost of fresh produce, and other measures.

Meanwhile, consider kicking the soda habit: It could be exacting a hefty toll on your health.

This originally appeared as “Calls for a Soda Tax” in the June 2018 print issue of Experience Life.

Photography by: John Mowers

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