Tax on sugary drinks may be on the horizon
November 16, 2009 by LEAH BISHOP
Filed under News
For decades, soft drinks have been a staple in restaurants, supermarkets and family refrigerators across the nation.
Occupying an entire aisle in grocery stores, the variety of sodas make the drinks a cheap and readily-available thirst-quencher for millions of Americans.
But these drinks may not seem as refreshing if a tax that is under discussion in the Congressional Budget Office is passed.
“The concept of a tax on sugar-sweetened beverages as a means to help pay for health care was scored by the CBO earlier this year and discussed by lawmakers as they crafted health care legislation,” said Jessica Badger, manager of communications for the American Beverage Association, a Washington, D.C., lobbying group.
The idea of a national excise tax – a tax imposed on a specific type of good or service – on soft drinks was proposed in May and is still being discussed by lawmakers, and lobbied against by some institutions within the food and beverage industry.
The tax is being pitched as a way to raise revenue for health care, and also fight obesity by dissuading Americans from consuming sugary beverages. The prices of sports drinks, juices, sweetened teas and even some flavored waters would also see an increase from the tax.
“It’s important to note that such a tax is regressive and would squeeze middle-class families already struggling through a recession,” Badger said. “There could not be a worse time to ask people to pay more.”
The CBO estimated a three cent tax per 12-ounce serving would generate $24 billion in four years, according to a Wall Street Journal report earlier this year.
Despite the increased revenue and possible health benefits, some lobbyists are saying raising the price on sugar-sweetened beverages could reduce job opportunities for Americans.
Badger said more than 75,000 individuals have signed a petition telling Congress to say no to a soda tax.
But many dietitians and health officials might argue against these lobbyists on the assertion that a soda tax could reap health benefits and contribute to lowering obesity rates in America.
“When you consume calories from beverages, they are not processed the same as when you consume calories from food,” said Connie Crawley, a registered dietitian and public service associate in the University’s College of Family and Consumer Sciences. “Our body is naturally programed to prevent dehydration, a protective mechanism that causes us to drink more even if we’ve consumed a lot of calories from beverages.”
Crawley said though the nation’s weight problem is not just from sugary beverages, eliminating them and switching to diet drinks could make a significant difference.
“Since the tax wouldn’t include diet drinks, there might be a switch for some people to the non-sugary drinks, which would be a change in the right direction,” Crawley said. “Diet drinks still are not contributing nutrition, but at least they are not adding empty calories.”
Crawley said there are still people who are going to drink soft drinks no matter how much you tax them.
“If people want something, they are going to pay the price,” Crawley said. “Cigarette taxes deter people from buying cigarettes up to a certain point, but there is still going to be a percentage of people that will continue to smoke.”
Badger said a tax on soda won’t work, as obesity is a serious challenge in the U.S. and won’t be solved by eliminating one item from a diet.
“The CBO has estimated how much revenue it could raise,” Badger said. “At the same time however, activists have been making the claim that a tax will cut consumption. We don’t believe you can have it both ways.”
