About Sugar-sweetened Beverages
What are sugar-sweetened beverages?
For the proposed tax, sugar-sweetened beverages are soft drinks that contain more that 10 calories per 8 ounces. They include sweetened water, soda, sports drinks, “energy” drinks, colas, sweetened bottled coffee or tea, and sweetened fruit or vegetable drinks containing less than 70% natural fruit or vegetable juice. Milk, milk products, milk substitutes, dietary aids, and infant formula are exempt.
Do all New Yorkers consume 46 gallons per year of sugar-sweetened beverages?
No. This is an average for U.S. adults. Some people do not consume any soft drinks; others consume more than 46 gallons per year. Those who consume the greatest amounts, usually reduce their consumption the most in response to a price increase, and thus save the most money and improve their health the most as a consequence.
About the Tax
Why tax sugar-sweetened beverages?
Taxing sugar-sweetened beverages is likely to lead to a decrease in consumption, especially among population groups that are most sensitive to price, e.g., children, low income populations, and those with higher intakes of sugar-sweetened beverages. These are the same groups who are most likely to suffer negative health impacts from high sugar-sweetened beverage consumption. A decrease in sugar-sweetened beverage consumption is likely to reduce calorie intake and lead to better weight status. Increasing the cost of sugar-sweetened beverages relative to the cost of healthier beverages (such as water and low-fat milk) may lead to an increase in the consumption of the healthier beverages. A similar tax on tobacco products has contributed to a significant decrease in cigarette consumption and smoking rates, particularly among children.
Why tax only sugar-sweetened beverages? Other foods, like Twinkies and Ding Dongs, provide empty calories.
There is significant evidence linking sugar-sweetened beverage consumption with obesity and other health problems. Studies that follow people for a long time show that people who consume more sugar-sweetened beverages gain more weight. One article that reviewed many studies found that drinking sugar-sweetened beverages had the strongest link with overweight and obesity, more than any other food-related behavior. When people drink a sugar-sweetened beverage, they do not compensate (i.e., reduce their concomitant or subsequent caloric intake) for the additional calories from the drink. So the calories from the drink become "extra" calories.
Shouldn’t all sodas be taxed, diet and non-diet? Diet sodas are not good for people, either.
While drinking diet soda is not recommended, the evidence linking its consumption with poor health outcomes and/or obesity is weaker than the evidence for sugar-sweetened sodas. The most healthful drinks are water and low-fat or fat-free milk.
Won’t taxing non-diet soda just encourage people to drink diet soda, which is not really a healthier alternative?
With increased public awareness surrounding the tax, we expect people to switch to healthier beverages like water and low-fat milk.
Aren’t people opposed to a tax on sugar-sweetened beverages?
A majority of New York adults support a tax on sugar-sweetened beverages. In a poll conducted by the Healthcare Education Project in January of 2010, 78% of the people polled supported a tax on sugar-sweetened beverages if the revenue raised was to be used to prevent healthcare cuts.
Will this level of tax really cause a decrease in consumption?
Two studies show that increasing price can decrease consumption. One completed by the U.S. Economic Research Service found that a 10% increase in the price of soda would lead to an 8% reduction in consumption among low income populations.
In a Norwegian study, increasing the price of soft drinks by 10.8% was estimated to decrease consumption by nearly 7% in the lowest consumption group, by 17% in the highest consumption group, and by an average 9.5% overall. Increasing the price by 27.3% was associated with a drop in consumption of 17% in the lowest use group, 44% in the highest use group, and an overall 24% reduction in consumption across the population.
Instead of taxing people, why not educate them about the health consequences of sugar-sweetened beverage consumption?
Public education campaigns alone are rarely effective in changing behavior. They are most effective when combined with other public health interventions, like price increases, that provide a financial incentive for people to change their behavior. Most people know that soda is not a healthy choice. The cost of an effective public awareness campaign to discourage soda consumption would be quite expensive. The tax creates an environment that encourages people to make healthier choices, in the same way that the tobacco tax discourages people from smoking.
Effects on the Family
How much will the sugar-sweetened beverage tax cost the average New Yorker?
Consumption of sugar-sweetened beverages by U.S. adults was about 46 gallons per year per person in 1999-2004. If a person did not change his/her consumption, it’s possible that he/she would spend an additional $59 per year on sugar-sweetened beverages. If one reduced his/her consumption by 10% (as predicted) in response to an increase of one cent per ounce, the cost of the tax would be significantly offset by the savings from purchasing fewer sugar-sweetened beverages. In this case, the net cost impact would be an additional $18 per year. However, if an adult replaced half of his/her average 46 gallons/year intake of sugar-sweetened beverages (-23 gallons) with equal amounts of tap water (+11.5 gallons) and low-fat milk (+11.5 gallons), he/she would save about $100 per year.
Won’t the sugar-sweetened beverage tax hurt the poor disproportionately?
Sugar-sweetened beverages are a discretionary beverage; they are not needed at all. Soft drinks provide no needed nutrients; they simply add calories to the diet. While surveys in New York State, and in NYC show that people with lower incomes and lower educational attainments drink more soft drinks than those with higher incomes and more education, all New Yorkers would save money by making a switch from drinking sugar-sweetened beverages to drinking healthier beverages, such as low-fat milk and tap water.
Won’t the tax increase families’ food costs greatly?
It would only increase food costs if families continue to buy similar amounts of sugar-sweetened beverages as they did before the tax. If adults continue to consume the average amount of sugar-sweetened beverages, 46 gallons per year, the added cost from the tax would be $59 per year per person. If they decrease their consumption of sugar-sweetened beverages by 10%, the cost of the tax would be significantly offset by the savings from purchasing fewer sugar-sweetened beverages. In this case, the net cost impact would be an additional $18 per year per person. If an adult replaced half of his/her yearly intake of sugar-sweetened beverages with tap water and low-fat milk (in equal amounts, i.e., 11.5 gallons per year of each), he/she would save about $100 per year and greatly improve his/her nutrition.
Obesity Related Questions
Isn’t lack of exercise the real problem in obesity
In terms of weight maintenance, it’s much easier not to consume extra calories than to burn them off. For example, an average adult would need to walk 27 minutes (or almost two miles) at a moderate pace to burn the calories contained in one 12-ounce can of soda (150 calories). And this is in addition to the recommended 150 minutes per week of moderate physical activity to decrease risk for chronic disease. It would take 46 minutes of walking to burn off a 20 ounce soda (250 calories). The majority of adults do not meet the recommended 150 minute per week guideline, so it’s unlikely they’ll find time to walk the additional minutes to cover soda consumption. A 75 pound child (average 10-year-old child) would need to bicycle vigorously for about 30 minutes to burn off a 12 ounce can of soda. The most effective way to reduce weight and maintain a healthy weight is pay attention to both diet and physical activity – eat less and move more.
With reports indicating that obesity rates are starting to level off in children, why is there concern about continuing to address it?
Obesity rates in children and adolescents are 3 to 4 times higher than they were 30-40 years ago.
Among elementary school students in NYS, 38-43 percent are overweight or obese; 20-24 percent are obese while an additional 18-19 percent are overweight.
Among low-income children, aged 2-5 years, 32 percent are overweight or obesity; 15 percent are obese and another 17 percent are overweight.
One third of children are overweight or obese. Among adults, obesity rates are continuing to increase. Currently 25 percent of New York adults are obese and another 35% are overweight. Adults who are overweight or obese still need help to lose weight and/or avoid gaining excess weight. The Healthy People 2010 goal for obesity rates in adults is less than15%, and for obesity in children, the goal is less than 5%.
How much does New York spend each year on medical care for obesity-related conditions?
According to a report by New York State Comptroller DiNapoli, New York ranks second among U.S. states in adult obesity-related medical expenditures, with total spending estimated at nearly $7.6 billion; 81%, of which, is paid by Medicaid and Medicare, far exceeding the national average of 52%.
Government and Revenue
Why does the government have a right to say what I should eat or drink? Isn’t this tax making New York State the “food police?”
There is already a sales tax on foods and beverages with low nutritional value (e.g., soda, candy). The proposed tax does not prohibit people from buying sugar-sweetened beverages. People may choose to buy fewer sugar-sweetened beverages and save money and improve their health by drinking water or low-fat milk, which are not taxed.
Isn’t this just a way to increase revenue for the state?
While revenue would be generated by the sugar-sweetened beverage tax and used for health related initiatives, the measure is designed to do both--decrease consumption of sugar-sweetened beverages, just as the cigarette tax is levied to decrease tobacco use -- and improve health, as well as provide needed revenue. Revenue generated from this tax will go to the New York State Health Care Reform Act (HCRA) Resources Fund to be used for health care and health related initiatives.
Effects on Beverage Industry
Isn’t the beverage industry opposed to the tax?
The beverage industry strives to maximize profits by selling as many sugar-sweetened beverages as possible. They want people to believe that sugar-sweetened beverages do not contribute to obesity or any other health problems. They are expected to be against anything that might decrease consumption and, therefore, their sales’ revenue.
Won’t this tax hurt businesses that sell sugar-sweetened beverages by decreasing revenue?
It’s likely that some people who would have bought sugar-sweetened beverages will buy a different beverage, for example bottled water, unsweetened tea or low-fat milk. However, if some people choose to drink tap water instead of a bottled sweetened beverage, some businesses may see a decrease in revenue.
If people do decrease sugar-sweetened beverage consumption, won’t that hurt beverage companies, possibly causing lay-offs?
The proposed tax is expected to lead to a 10-15% reduction in sugar-sweetened beverage consumption; this would not be sufficient to cause significantly decreased production and lay-offs. Some people will replace sugar-sweetened beverages with alternative beverages, many of which are produced by the same beverage companies. Thus, there may be an increase in demand for healthier beverages, such as water, non-caloric flavored seltzers, and unsweetened ice tea, which would partially compensate for the reduced demand for sugar-sweetened beverages.