Sugar-Sweetened Beverage Tax Begins to Have a Positive Effect

Via the Center for Health Law and Policy Innovation
By Kristie Gurley J.D. ’15

It is widely acknowledged that consumption of sugar-sweetened beverages (SSBs) has a negative impact on public health—sodas and juices directly contribute to the obesity epidemic in America, and they can be especially harmful for children (those who drink at least one serving of SSBs per day have 55% increased odds of being overweight or obese). However, how to decrease consumption of SSBs is widely disputed. Some municipalities have considered adopting a tax on SSBs that would deter the purchase of SSBs, and thus the consumption of SSBs. This past November, Berkeley, California, became the first city to pass a “soda tax,” imposing a one-cent-per-ounce tax on all soft drinks.

While the Berkeley soda tax represented an historic victory for anti-SSB voters (they prevailed over a $10 million opposition campaign), it was unclear whether a one-cent-per-ounce tax on SSBs could make a difference at the point of consumption. In late January, voters witnessed an immediate impact: two local “Dollar Tree” stores pulled sodas from their shelves entirely. For a store stocking only products that can be sold for under $1, the tax—which is levied on distribution companies—raised the price of SSBs above the Dollar Tree threshold. Randy Guiler, Dollar Tree’s Vice President of Investor Relations, said the store could no longer cover the tax’s costs on beverages with a one-dollar price tag. The Dollar Tree locations in Berkeley currently stock only water and fruit juices.

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