Could Sweet Taxes Fight Obesity?

February 3, 2011

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sweet tax

You may have heard of several recent initiatives attempting to tax sugary drinks like soda to try and curb the skyrocketing obesity rates.

Similar to so-called sin taxes already in place on items such as tobacco and alcohol, such a tax could raise billions of dollars to help fight obesity, proponents argue. Increased prices, about 6 cents a can, might encourage consumers to reach for a healthier beverage option instead.

 

With each American averaging 597 cans of soda a year and 306 million people in the U.S., that comes to 182,682,000,000 cans per year, creating a possible $10 billion in annual revenue to fight obesity. But would it work?

On one hand, people may just switch to a less expensive brand or find another way to get their fix than to give up the bad habit because of the cost. Such taxes also tend to hit those in the lowest economic classes the hardest, where the cost of switching to a healthier option is prohibitive. On the other hand, the increased cost could deter customers from choosing soda or other sugary drinks.

Research suggests that a tax could derail sugar consumption and increase overall health. According to the American Heart Association, Research shows effective taxes could reduce adult consumption of sugary drinks by 15 percent, obesity by 1.5 percent and new cases of diabetes by 2.6 percent. A study conducted on the recent sugar tax in California shows that sales of sugary drinks has decreased as taxes increased. Sales of soda decreased nearly 10% while sales of water increased in the years following the introduction of the tax.

If the taxes are successful in the long run, the question of where this tax revenue would be spent also needs to be addressed.

One option is to have the money generated by the tax directed at educational campaigns to help people understand what all those sodas and sugary drinks are doing to their bodies, and what some better options might be. Perhaps the money could also be used to subsidize the higher cost of eating healthier, and to make healthy options as quick, easy, and affordable as junk food.

Government policies should shift to support teaching children from kindergarten on about good nutrition and offering healthy options in school cafeterias, encouraging those on public assistance to buy quality foods rather than high calorie, low nutrition ones, and providing funding to help people who want to lose weight pay for programs that can help them do so.

Remember: The costs to society of obesity are staggering. Centers for Disease Control and Prevention experts estimate $147 billion dollars per year in medical expenses can be directly linked to obesity and its resulting health problems. That’s nearly $1 of every $10 spent on healthcare in the United States!

Clearly, something must be done both on an individual level and for society as a whole. It’s in all our best interest to start shunning unhealthy products like soda and start living a healthier lifestyle, sweet tax or not.

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