In the most recent edition of The CATO Institute’s Regulation Magazine, Jonathan Klick, a professor of law at the University of Pennsylvania Law School, and Eric A. Helland, an economics professor at Claremont McKenna College, discredit claims that a soda tax would be effective for improving public health and increasing revenue for government. They write in their conclusion:
“While politicians at all levels of government in the United States have been drawn to soda taxes as a way to both raise money and fight obesity, the evidence suggests that taxes may in fact do neither. Yes, individuals do seem to be price sensitive when it comes to soda and other sugar-sweetened beverages. That implies, however, that any increase in tax rates will be offset largely by declining demand for soda specifically, but not for calorie-rich foods overall. While many public health advocates grab on to any indication of price sensitivity to support taxes as a way to reverse the upward trend of obesity, no study finds that this effect is very large in terms of the ultimate effect on body weight, as individuals substitute to consuming other calorie-dense beverages, adjust their eating habits in ways that have little net effect on BMI, or generally undo the positive effects of reduced soda consumption.”
As we’ve said before, taxes do not make people healthier. A new tax on certain beverages will not teach people healthy lifestyles or change their behavior. Making smart, educated decisions about diet and exercise do that.