Whether you call it pop, fizz, soda, soft drinks, or just plain cola, a tax on our favorite sugary drinks is sweeping across the globe.
From South Africa and the UK, who both currently have proposals for a soda tax starting as soon as late 2016, to Mexico, who imposed a tax on both sugar-sweetened drinks and junk food in late 2013, or the United States, who began debating the idea of a nationwide soda tax in 2005 when the American Beverage Associate began lobbying to remove soft drinks from schools with children under fourteen and replacing them with healthier drinks like juice or milk.
Asian countries like India and the Philippines, where the soft drink industry is said to be worth upwards of $18billion, have plans to impose forms of tax on sugar as well. The potential health concern of fizzy fountain drinks in Asian countries isn’t as relevant as it is in the western world, but medical professionals say the increase of Buddha bellies across the continent has been quite noticeable.
In 2009 the American Heart Association reported that sugary drinks were still the largest contributor of unnecessary sugars in American diets. That same year 33 U.S. states imposed a soda tax, despite the Journal of Adolescent Health reporting that it would take a significant tax to reduce the amount of sweets consumed. A significant tax was not proposed, but it’s fair to say that at the time the taxes were aimed more at generating revenue, after reports from the Health and Human Services Department proposed that such a tax would generate upwards of $15billion, and that these revenues could be used in to improve relevant health concerns, like obesity prevention, nutritional education, and advancing health care reform.
Who reaps the benefits of a soda tax?
In the example of Denmark, who imposed a similar tax on foods containing sugar as well as “fat tax” back in 1930, the tax failed horribly, claiming that citizens simply sourced foods heavy in fat and sugar – like butter, ice cream, and soda – from neighboring countries. However, in the cases of France and Mexico, who’ve both had established soda taxes for several years, sales on soda and junk food have fallen by as much as 12%. That’s pretty impressive!
In the U.S., proposals for a soda tax have ranged from the national level all the way down to the municipal level, with Berkeley, California becoming the first place in the U.S. a city-wide soda tax was imposed. The effectiveness of these taxes in the U.S. is yet to be thoroughly determined, but studies have shown that an increase of at least 18% would be effective in reducing the consumption of soda and sugary drinks enough to make a noticeable difference in the health of many Americans.
So, it’s a fair to say that the only ones on the other side of the fence are the manufacturers of soft drinks and junk food. In places like Mexico, who imposed a tax of approximately $0.08US per liter on soda, it seems that this has discouraged many consumers from purchasing their favorite bubbly beverages, with sales of soda and other sugary drinks down 6% annually the last 2 years running. On the flip side, the United States who imposed a much lower tax, has also been guzzling slightly fewer gallons, while using revenue from these taxes to bring about health reform laws like the Affordable Healthcare Act a.k.a. ObamaCare.
So are we really less fat because of a soda tax?
It’s still unclear whether a soda tax is effective in combating serious conditions like diabetes and obesity, but if the money is used appropriately, by providing educational programs, accessible healthcare and affordable medications, it doesn’t seem like a soda tax is a bad idea.