The Tax on Sodas Starts This Fall, But Will It Work?
The D.C. Council didn't exactly pass a soda tax, but it did the next best thing: It extended the 6 percent sales tax on, as D.C. Wire noted, "sodas and other 'non-alcoholic beverages with natural or artificial sweeteners.'"
Call it whatever you like, but sodas will be taxed starting Oct. 1. The main question, of course, remains unanswered: Will the tax have any effect on consumption and on childhood obesity? Apparently so, according to two studies pointed out by Marion Nestle over at the Atlantic Food Channel.
Nestle singles out a July 2010 U.S. Department of Agriculture analysis, a rather theoretical piece of research that came to these conclusions based on a 20 percent price increase to "caloric sweetened beverages":
- A tax-induced 20-percent increase in the price of caloric sweetened beverages could reduce net calorie intake from all beverages by 37 calories per day for the average adult. The effects for children were estimated to be larger — an average reduction of 43 calories per day.
- By assuming that 1 pound of body fat has about 3,500 calories, and assuming all else remains equal, the daily calorie reductions would translate into an average reduction of 3.8 pounds over a year for adults and 4.5 pounds over a year for children.
- The weight loss induced by the tax could reduce the overweight prevalence among adults from 66.9 to 62.4 percent and the prevalence of obesity from 33.4 to 30.4 percent. For children, the at-risk-of-overweight prevalence would decline from 32.2 to 27.0 percent and the overweight prevalence would decline from 16.6 to 13.7 percent.
Nestle also directs our attention to a more concrete study by Harvard researchers who implemented a five-phase plan to see what method, if any, would affect soft drink consumption at the Brigham and Women’s Hospital cafeteria in Boston. The study's abstract spells out the details:
Methods. We implemented a 5-phase intervention at the Brigham and Women’s Hospital cafeteria in Boston, Massachusetts. After posting existing prices of regular and diet soft drinks and water during baseline, we imposed several interventions in series: a price increase of 35% on regular soft drinks, a reversion to baseline prices (washout), an educational campaign, and a combination price and educational period. We collected data from a comparison site, Beth Israel Deaconess Hospital, also in Boston, for the final 3 phases.
Results. Sales of regular soft drinks declined by 26% during the price increase phase. This reduction in sales persisted throughout the study period, with an additional decline of 18% during the combination phase compared with the washout period. Education had no independent effect on sales. Analysis of the comparison site showed no change in regular soft drink sales during the study period.
Interestingly enough, both of these research tools were based on much higher price increases than a 6 percent sales tax. Makes me wonder what kind of effect D.C.'s soda tax will have on consumption.
Photo by Poolie via Flickr Creative Commons, Attribution License