Soda Tax in Berkeley Leads to Drop in Consumption

Residents of Philadelphia take note!

Consumption of soda and other sugary drinks fell by 21% in low-income neighborhoods of Berkeley after the California city became the first in the U.S. to introduce a special tax last year of a penny per ounce, according to a study published this past Tuesday. At the same time, soft and sugary drink consumption in low-income neighborhoods of San Francisco and Oakland rose 4%

The study is careful to note that it cannot prove the tax is what led to the decrease in consumption, but does state that the results “suggest’’ that the tax lowered consumption. The study acknowledges that other factors also could have been at play, such as increased awareness about the health impact of sugary drinks.

The study focused on low-income neighborhoods because the researchers say obesity and diabetes rates are higher in such neighborhoods, and price increases have a bigger impact on purchasing patterns.

While consumption of sugary drinks decreased, consumption of bottled water or tap water rose 63% in Berkeley during the period but a more modest 19% in San Francisco and Oakland.

This is good news for other cities, such as San Francisco and Oakland, that are expected to vote on a penny-per-ounce levy on sugary drinks in November ballot initiatives, while Boulder, is expected to vote on a two-cent per ounce tax.

Philadelphia’s city council in June approved a tax of 1.5 cents per ounce on sweetened drinks, becoming the second U.S. city to pass such a measure; a portion of the proceeds from the Philadelphia soda tax are targeted for preschool.

So it seems that if the Philly tax plan has the same effect as the one in Berkeley, there should be an initial windfall from such a tax, but then the proceeds from the tax will decrease each year as consumption decreases.

I would think that will be tough to get used to, seeing a source of revenue in constant decline.

I’m a fan of what are known as sin taxes, so I would have no problem if the city finds some new sin to tax in a few years.

I’d like to suggest a tax on guns and bullet; hopefully it would have the same effect as the Berkeley soda tax..



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Jim Borden

Accounting Prof. at Villanova; happily married for 30+ years; father of 3 outstanding young men; vegan; interests: fitness, creativity, education, blogging, social media.

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