Taxes on common grocery items such as beverages are often touted as the solution to our public health woes. As a commentary in the East Bay Times explains, such taxes are ineffective and regressive, and a study claiming otherwise is “fatally flawed.”
“No one needs the government or special interests playing nanny and telling them they shouldn’t have a soda — especially when the justification is supported by strained extrapolations from flawed research,” wrote Josh T. Smith, a master’s student in economics at Utah State University, and William Shughart II, research director of the Oakland-based Independent Institute and the J. Fish Smith Professor in Public Choice at Utah State’s Huntsman School of Business.
The authors pushed back on a study published in the American Journal of Public Health purporting to show that three months after a tax was imposed in Berkeley, poor people reduced their consumption of sugar-sweetened beverages by 21 percent. They said that “the study is fatally flawed” and “does not employ a rigorous enough method to justify the tax.”
Smith and Shughart noted that the study had required a nonrandom, street-intercept survey to recall and compare the pretax and post-tax drinking habits of respondents. This method is inaccurate because “people rarely give accurate answers to such questions and instead ‘anchor’ their responses to convenient numbers that pop into their heads. It’s well known that survey respondents often want to please their interviewers.”
Given this fundamental flaw in the data collection method, it is hard to prove if the tax in Berkeley affected people’s consumption at all, they said.
The authors also refutes the activists’ claims that the revenue collected from the beverage tax will go towards education. “Research on similar policies shows that money earmarked for one program often ends up being redirected to more politically expedient purposes.”
Lawmakers and public health activists may want to believe that taxes will solve our nation’s public health problems, but we just can’t tax our way to better health when it comes to diet. These taxes have negative side effects: they hurt low-income families, small businesses, jobs and incomes. Instead “voters should respect the dignity of individuals and let them freely choose what they will eat and drink,” the authors conclude.
To learn more about why taxes are not the answer, visit The Truth About Beverage Taxes.