Dive Brief:

  • A new research discovered sweetened beverage purchases fell in Philadelphia and Oakland, California following the adoption of taxes on the sugary drinks — however some shoppers traveled outdoors these cities to buy tax-free. The research was performed by researchers from Mathematica, Cornell University and the University of Iowa.
  • After analyzing knowledge from earlier than and almost a 12 months after the taxes had been adopted, researchers discovered the taxes had no general detectable influence on how usually youngsters drank taxed drinks in both metropolis. But researchers mentioned youngsters in Philadelphia who drank a whole lot of sugary drinks earlier than the tax lowered their consumption of added-sugar drinks by 22%.
  • Researchers included in-store audits of costs and product availability, interviewed prospects exiting shops about beverage purchases, surveyed households about consumption and interviewed retailer homeowners. The exit interviews discovered purchases of taxed drinks went down by 9 ounces per journey in Philadelphia, however discovered no detectable influence in Oakland.

Dive Insight:

Soda taxes have lengthy been a controversial matter and these combined results from Philadelphia and Oakland do not assist definitively show their effectiveness. But this research reveals how soda taxes are designed and carried out impacts how shoppers and retailers reply.

Oakland’s 1 cent-per-ounce soda tax began being collected in July 2017 after voters accepted it the earlier November. Philadelphia has had a 1.5 cents-per-ounce tax that was accepted by City Council in 2016. Collection started in 2017. Philadelphia’s tax, on a wider array of drinks than the one in Oakland, is unpopular with present council members and, relying on who town elects to management subsequent month, may be on its method to being phased out.

Distributors and retailers handed a lot of the tax on to shoppers, the research discovered. The pass-through charge was 105% in Philadelphia and 61% in Oakland. The common worth of taxed drinks rose by 21% in Philadelphia, however solely 8% in Oakland, researchers mentioned.

Study: While soda taxes reduce consumption, they may not deliver intended results 1

Megan Poinski for Food Dive


Adults in Philadelphia consumed about 30% much less common soda after the tax, and the likelihood that an grownup in Oakland consumed any common soda lowered 9%. However, that wasn’t true concerning youngsters’s consumption of sugary drinks, the place no detectable influence on frequency was discovered. The better influence on grownup soda consumption than on youngsters’s may increase questions on whether or not the Philadelphia or Oakland taxes are as efficient as they is likely to be in combating weight problems and diabetes, a serious aim of each initiatives.

The analysis staff did a separate research in September on how retailers in each cities responded to the soda tax. After interviewing retailers in Philadelphia, they discovered 14 raised costs of taxed drinks by the quantity of the tax. One retailer elevated costs by lower than the tax charge, and one raised costs on untaxed merchandise. Of the Oakland retailers interviewed, 10 hiked costs by the tax quantity, two raised them by extra and three by much less. Two retailers in Oakland elevated the costs of untaxed gadgets. 

Soda taxes have been controversial anyplace they’ve surfaced. The beverage trade opposes them for singling out sugar because the enemy, and critics say the aim of benefiting public well being with the proceeds is not being met. Philadelphia’s first-year income from the tax was 15% wanting projections. The soda trade is lobbying to ban new beverage taxes on the state stage, and was victorious in California final 12 months as state legislators and Gov. Jerry Brown accepted a 12-year moratorium on soda taxes. And, as bolstered by this newest research, shoppers get across the tax by purchasing outdoors town or county the place it exists. 

But soda taxes do drive down consumption of sugar-sweetened drinks. A research printed earlier this 12 months took 5 years of knowledge from Berkeley, California, and located a 52% lower in soda consumption within the first three years after the tax was adopted. Another research discovered that two months after Philadelphia’s tax took impact, residents had been about 40% much less more likely to drink sugary drinks every day than folks elsewhere.

Soda tax supporters may have a harder time getting them adopted since statewide bans are surfacing. Arizona, Washington and Michigan have forbidden native governments from taxing meals and drinks. Legislation establishing a statewide 2-cent-per-ounce tax in California fell wanting mandatory help this previous spring. Without a clearer connection between soda taxes and public well being advantages, there might be fewer such taxes sooner or later.


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