NPR logo To Tax Or Not To Tax? States Enter The Soda Wars


To Tax Or Not To Tax? States Enter The Soda Wars

Supporters of soft-drink taxes haven't succeeded on the national stage, but a state-by-state approach seems to be working. hide caption

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Supporters of soft-drink taxes haven't succeeded on the national stage, but a state-by-state approach seems to be working.

Companies that make sugary soft drinks, such as Coke and Pepsi, have been battling with activists worried about obesity in the U.S. The latest fight: whether to tax soda.

The industry fended off a national tax last year after spending millions of dollars to air television ads across the country. One of the ads featured a woman unloading groceries from a car and making the case that families can't afford to pay more for juice drinks and soda.

But backers of soda taxes are having more success at the state level.

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Colorado recently joined more than 30 other states when it began subjecting soft drinks to its 2.9 percent state sales tax. Previously, soda was exempt, like most groceries. The extra revenue will help fill that state's $1.5 billion budget hole.

One Activist's View: Only A Higher Tax Will Change Behavior

For consumers, the new tax will add about 5 cents to the cost of a 2-liter bottle of soda. Kelly Brownell at the Rudd Center for Food Policy and Obesity at Yale University says that's not enough.

He wants new taxes that would boost the price of that same 2-liter bottle by almost 70 cents. He says a new tax has to be high if it's going to change the average American's habit of consuming 50 gallons of sugar-added drinks a year.

"We figure that a tax of a penny an ounce would reduce that number to 38.5 gallons a year," Brownell says.

Just How Bad Is Soda For The Body?

Two experts debate the issue from different perspectives.

Against Soda
Gail Woodward-Lopez, associate director of the Center for Weight and Health at the University of California, Berkeley, says that as Americans have consumed more sugary drinks, obesity rates have soared.

"We have very strong evidence linking those two trends," she says.

What's more, she says, soda doesn't have the same "filling properties" other foods and beverages do, so people drink soda but don't reduce other caloric intake. And they're drinking soda instead of healthier drinks, such as milk.

Woodward-Lopez says that sweetened beverage consumption accounts for 50 percent of the sugar intake in the U.S. diet. And sugar intake has been linked to the increase in diabetes.

She says that people should drink soda in moderation — once per week — but she says it "definitely should not be part of your daily intake."

For Soda
Maureen Storey, senior vice president for science policy at the American Beverage Association and a former research professor at the University of Maryland, says a handful of studies disprove the link between soda and obesity.

She says that Americans are consuming more of everything and not exercising enough.

"Soda is comprised mostly of water," she says. "Water is the most important nutrient that we have."

She says the high-fructose corn syrup in soda also provides energy.

"If we are active and need a refreshing beverage after a nice long walk or run, you can have a beverage and quench your thirst and stay hydrated."

Storey calls the comparison between tobacco and soda "hyperbole."

"Smoking kills people," she says. "There is no safe level of consumption. Soft drinks are an enjoyable, safe product that people have been enjoying for generations."

—NPR Staff

The revenue from that tax, he argues, could help pay for obesity-related health care costs, or even subsidize healthier foods.

"You can educate people all day long, but you can never compete with the amount of marketing money the industry spends to educate people to consume these beverages," he says.

Unfairly Targeted?

Several other states are talking about higher soda taxes — including California and New York. Activists like Brownell often point to cigarettes as their model. As taxes were increased, public perceptions of smoking changed and tobacco use declined significantly.

As you might expect, the $110 billion-a-year soft-drink business doesn't like being linked to tobacco.

"I don't think a cigarette that can kill you is anywhere in the same universe as having a soft drink now and then, which tastes good and has a few calories in it, which you can burn off if you have a healthy, active lifestyle," says Susan Neely, president and CEO of the American Beverage Association.

But in the same spirit as anti-smoking advertisements, New York City's health department has released a video on YouTube showing a guy drinking an orange soda loaded with big clumps of fat. The ad's tagline says, "Don't drink yourself fat." (If you're in the mood to be disgusted, you can watch it here.)

The industry says it's being unfairly targeted. Soft-drink makers argue that even with increased soda consumption in this country, their products account for only about 5 percent of the calories Americans consume.