American Beverage Association

April 8, 2013

A Tax on Soft Drinks is Insane

There are two sides to every story. For instance, on the one hand, practice makes perfect. On the other hand, doing the same thing over and over again and expecting different results is allegedly how Albert Einstein defined “insanity.”

Over the past several years, approximately 30 states and cities across the country have proposed so-called “soda taxes.” All  have failed. So are the proponents of these taxes who keep trying to push them on consumers merely practicing? Or are they just insane?

Consider the tale of California where voters from two cities went to the polls in November 2012 and overwhelmingly defeated penny-per-ounce taxes on soft drinks. The response of those voters to taxing bottled teas, waters and other soft drinks was unmistakable: no way!

Yet, here we are less than six months later and once again a California politician, state Assemblyman Bill Monning, is trying to impose a penny-per-ounce tax on sweetened beverages, hoping for a different result from all the other failed attempts.

An opinion editorial published in the San Diego Union Tribune explains quite well why taxing soft drinks in the name of obesity is doomed:

“The fundamental problem with soda taxes is that they don’t address the causes of obesity. Changes in society that we rightly credit for making our working lives easier and easing our home lives have reduced the amount of calories we expend in daily life. Office jobs, expansive suburban communities (cars have replaced short walks), and labor-saving devices from power lawn mowers to washing machines all make our lives better, but the price is less physical activity and possibly more obesity.

“And even on the ‘calories in’ side of the equation, a soda tax doesn’t address the problem appropriately. A recent study in the Archives of Internal Medicine found that a 40 percent sales tax on soda – in the ballpark of Monning’s proposed tax – would reduce calorie intake by a trivial amount. It turns out that rather than choosing water, people drink something else with equal calories, like juice or milk. By doing so, they dodge the intent of the tax and don’t lose weight.”

It’s impossible to perfect bad policy, no matter how many attempts. The bottom line is – proposed soda taxes have proven time and time again to be unpopular with voters. It’s just not the role of government to dictate what we can and cannot put in our grocery cart.  And most importantly, taxes don’t make people healthier. They have no place in the many meaningful initiatives our industry is leading to do our part to combat obesity.


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