Questions & Answers
Q: Why tax soft drinks?
A: Taxing the one beverage or food that has been shown to promote weight gain is a sensible means of reducing consumption and generating revenues that could help fund health-care and obesity-prevention measures. A small tax, such as a 5% sales tax would generate revenues without significantly affecting consumption, while a larger tax, such as a penny per ounce (12 cents per can), would raise more money and reduce consumption. Tobacco taxes have contributed to reductions in cigarette consumption and smoking rates, particularly among children.
Q: Why tax only soft drinks and not snack foods or other junk foods?
A: A number of states do tax snack foods, and other states and the federal government could do the same. Snacks probably contribute to weight gain, and snack taxes could raise substantial amounts of money. But soft drinks are the only individual food or beverage that has been directly linked to obesity, and soft drink taxes would be easier to collect because of the modest number of manufacturers. Applying a junk food definition to a sales tax could be complex to implement.
Q: Why are soft drinks particularly conducive to weight gain?
A: Studies show that beverages promote weight gain more than solid foods. When people consume a solid food, they are more likely to compensate and reduce their consumption of other calories.1,2 However, that "compensation" does not occur as much after drinking a caloric beverage, so the calories from the drink become "extra" calories. Of course, people should also limit their consumption of other high-calorie foods with limited nutritional value.
Q: Isn't this just a way to increase revenue for the state?
A: A soft drink tax would yield two benefits – it would generate funds for health and obesity prevention (or other) programs and, if high enough, would discourage consumption. The revenues generated by a soft drink tax could be used to provide much needed revenue for obesity prevention, such as improving meals and increasing physical education in schools, paying for inner-city basketball courts and swimming pools, and funding mass-media nutrition and physical activity promotion campaigns and other activities by state and local health departments.
Q: Wouldn't a soft drink tax hurt the poor disproportionately?
A: Soft drinks not only do not provide any positive nutritional value, they add lots of calories to the diet and have a negative effect on health. Lower-income adults drink more soft drinks than higher-income adults3 and thus would be affected disproportionately by a soft-drink tax. But they also would be helped disproportionately by the programs funded by the taxes (and, of course, by the health benefits from drinking less soda). And all people would save money in the long run by switching from sugar-sweetened beverages to healthier beverages, such as fat-free milk and water.
Q: Wouldn’t a soft drink tax lead to job loss?
A: Soft drink companies often use this argument, especially in today’s economic climate, to raise public support against soda taxes. The fear that people will lose jobs as a result of a soda tax is, however, completely unfounded. Soda companies produce a variety of low- and no-calorie beverages that can substitute for their traditional non-diet offerings. As consumption of sugar-sweetened beverages declines and demand for alternatives increases, the beverage industry will be able to avoid job loss and maintain their profit margins by aggressively marketing and selling these healthier alternatives.
Q: Isn't lack of exercise the real problem in obesity?
A: Eating too many calories and engaging in too little physical activity contribute to the high obesity rates in adults and children. However, it's much easier not to consume extra calories than to burn them off. For example, an average adult would need to walk 45 to 60 minutes (at a moderate pace) to burn off the 250 calories in one 20-ounce bottle of soda.4 The majority of adults do not engage in the recommended (and modest) 150 minutes of physical activity per week to reduce the risk of chronic diseases.5 The most effective way to reduce weight and maintain a healthy weight is pay attention to both diet and physical activity – eat less and move more.
Q: Isn't a soft drink tax turning the state into the "food police?" Why does the government have a right to say what I should eat or drink?
A: Most states already tax soft drinks (or snack foods) in one way or another (usually a sales tax on vended foods). A soft drink tax does not prohibit people from buying sugary beverages. People could choose to buy fewer soft drinks and save money and improve their health—or they could switch to diet sodas, water, seltzer water, or fat-free or low-fat milk, which are not taxed. And, of course, the government taxes countless other products from gasoline to beer.
Q: Instead of taxing people, why not educate them about the health consequences of soft drink consumption?
A: Public education campaigns are rarely effective because they are poorly funded, wishy-washy and of brief duration. But they can be effective when combined with other interventions, such as price increases, that motivate people to change their behavior. Some of the revenues from a soda tax should be used to fund a mass-media campaign to further discourage consumption.
Q: How much might a soft drink tax cost an average person?
A: The average adult (20 years and older) consumes 17.5 ounces of soft drinks (non-diet and diet) everyday.6 If an adult did not change his/her consumption, a 12-cent per 12-ounce serving excise tax would cost him/her an extra 17.5 cents per day and a 3-cent per 12-ounce serving tax an extra 4.5 cents per day. That added cost is similar for children and youth. Their average consumption is 20 ounces per day,7 amounting to an extra 20 cents and 5 cents per day for a 12-cent and 3-cent tax per 12-ounce serving, respectively.
Q: Wouldn't a soft drink tax hurt businesses?
A: It's likely that people who buy soft drinks will buy a different beverage, rather than no beverage. Most soft drink companies already make a range of beverages, many of which would not be taxed. And a soft drink tax would encourage beverage companies to increase production of non-sweetened beverages as demand for sweetened beverages declined, averting job losses. If there was a loss of jobs in the beverage sector, jobs would be created in other sectors from expenditures of the tax revenues and from the money people diverted from purchasing beverages to other goods.
Q: Shouldn't all sodas be taxed, diet and non-diet?
A: Diet sodas are devoid of nutrients, but they contain few or no calories. While drinking diet soda is not recommended because of their tooth-eroding acids, caffeine, and/or questionable artificial sweeteners, the evidence linking its consumption with a desire for sugar-sweetened foods and an increase in caloric intake and weight gain is weak.
Q: Would consumers see a price difference between diet and non-diet sodas?
A: Possibly, but possibly not. If bottlers had to pay an excise tax on regular soda, they might pass on that cost to the consumer by increasing the prices of both diet and non-diet sodas to keep prices equal. Fast-food restaurants, especially those with self-serve dispensers, also like to keep the prices of diet and non-diet sodas the same. But consumers would likely see increases in prices of soft drinks.
2 Chen L, Appel LJ, Loria C, Lin PH, Champagne CM, Elmer PJ, Ard JD, Mitchell D, Batch BC, Svetkey LP, Caballero B. Reduction in consumption of sugar-sweetened beverages is associated with weight loss: the PREMIER trial. Am J Clin Nutr. 2009 May;89(5):1299-306.
4 US Department of Health and Human Services. Aim for a Healthy Weight. NIH Publication No. 05-5213. August 2005.
5 Kruger J, Yore MM, Kohl HW. Physical activity levels and weight control status by body mass index, among adults – National Health and Nutrition Examination Survey 1999–2004. Int J Behav Nutr Phys Act. 2008;5:25.