Soda Taxes Are Nothing More Than a Money Grab

An Ad Age Editorial

Published on .

Local and state governments are headed for a sugar addiction that will surpass the one supposedly afflicting the nation's children.

New York state and the city of Philadelphia are among those considering proposals that would impose a stiff tax on soft drinks and other sweetened beverages. New York's proposal would tack on a penny an ounce, and Philly's would tack on 2ยข cents an ounce.

We could rant and rave about the country taking yet one more step toward abdicating all personal responsibility to an all-knowing government. But that battle seems already to have been lost. After all, more and more consumers seem to agree with activists that children aren't raised by parents, but rather by Magical TV sets that not only educate tots about the joys of high-fructose corn syrup, but also provide them money and transportation to stock up on daily rations of the stuff.

But that doesn't mean we have to swallow everything the activists and local governments are telling us. In this case, we're meant to believe that a sin tax is being implemented for the good of the children and for the betterment of the citizenry's health. Indeed, in one ad being put forth by The Alliance for a Healthier New York, it's insinuated that such a tax will curb cancer rates.

And while the activists may actually believe these things, from a political point of view these taxes are little more than a money grab by increasingly desperate governments looking to plug holes in their budgets.

The fact of the matter is, there is little evidence that such taxes change consumer behavior.

A recent study from a trio of researchers hailing from Yale, Emory and Bates found that a 1% tax increase on junk foods resulted in a 0.003-point decrease in BMI. The researchers calculated that a 58% tax on soda, which is roughly what cigarettes are taxed, could reduce the mean BMI in the U.S. by 0.16 points.

If soda is industrial-grade poison for children, both activists and the government should take immediate steps to make it illegal. That, of course, would never happen. After all, there's a wealth of evidence that cigarettes actually do kill people. But governments at all levels are hooked on that particular revenue stream, there's no chance they can quit.

Soda, by itself, isn't a silent killer. And soda taxes aren't a miracle cure for anything other than budget gaps.

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