Should We Tax Sugary Drinks?

Seven leading public health experts throughout the country have joined to write a report suggesting that we should tax sugar-sweetened drinks.  It’s published in the New England Journal of Medicine.   Here are their main arguments, and some criticism the idea has generated.

Over-consumption of sugary drinks, like Coca Cola or Sprite, has been linked to increases in obesity, diabetes, and heart disease.  The type of the sugar doesn’t matter – it can be sucrose (table sugar), high-fructose corn syrup, or fruit juice concentrates.  Taxation would reduce consumption, if the effect of taxes on cigarettes and liquor are anything to go by.  Reduced consumption would lead to improved general health of the population, and provide revenue to help lower health costs.

At a penny-per-ounce rate, the tax would increase the price of a 20-ounce can by 15% to 20%, and should generate almost $15 billion in the first year.  It should be an excise tax on the producers and wholesalers;  this would be easier to collect and enforce than one leveled on retailers.  A sales tax would only encourage purchase of lower priced brands, or large volume containers.

A supporter, Kelly Brownell, is the director of Yale’s Rudd Center for Food Policy and Obesity.  She notes that the proposal has 4 unique features: an immediate impact, a beneficial effect on the nation’s diet, extremely little cost, and considerable revenue. 

Criticism comes, of course, from the food industry.  A poll conducted by the Center for Consumer Freedom finds that 65% of Americans don’t approve of such taxes, and only 28% said it should be levied to control consumption.  However, the seven authors of the proposal quote a national poll saying that 54% of the public favor such a beverage tax.  Poll results obviously depend on who you ask, and how you ask them.

Others say the real problem with overweight is inactivity, not excess calorie intake.  Or “why single out soft drinks?  Candy bars and deserts are equally guilty of providing excess calories.”  One answer here is that sugary sodas provide absolutely no nutritional benefit, whereas other sweet food items may indeed have some beneficial effect.  Another has been provided by a UCLA study that shows conclusively that there’s a direct link between soda consumption and obesity.

This argument will doubtless go on for some time.  In the meantime, other countries are considering a similar move (UK, for example).  As usual, we’ll probably wait and see how they get on before taking such a decisive action.