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Will Massachusetts Be the First State to Tax Soda?

Will Massachusetts Be the First State to Tax Soda?



There is little disagreement among the medical community that soda and other sugary beverages are a major contributor to certain chronic diseases such as obesity and diabetes. But that knowledge hasn't been enough to change consumers' bad habits. Some Massachusetts legislators have proposed a tax on those beverages; this may be just the nudge people need to make healthier choices.

In January, State Senator Jason Lewis, Senate Chair of the Public Health Committee, filed a bill calling for a tiered excise tax on sugar-sweetened beverages. State Representative Kay Khan filed the same bill in the House. Targeting these beverages makes sense, says Lewis, because "sugary drinks are by far the largest source of added sugar in most people's diets." Take, for example, a standard 20-ounce soda: it contains 15 to 18 teaspoons of sugar and about 240 calories. According to the American Heart Association, that's two times the maximum daily recommendation for men (of no more than 9 teaspoons or 36 grams of added sugars) and almost three times as much for women (6 teaspoons or 25 grams). The heart-health organization also recommends that children and teens consume no more than 8 ounces of sugary beverages per week. Compare that to the reality that 60% of Massachusetts children drink at least one sugary drink per day.

Sugar-sweetened beverages (SSBs) include sodas, energy and sports drinks, and sweetened fruit juices, iced tea, and flavored waters. "There are clear and convincing studies that consuming sugary beverages is linked to developing serious health problems, including obesity, type 2 diabetes, heart disease, and tooth decay," says Lewis. The intent of the proposed bill, called An Act to Promote Healthy Alternatives to Sugary Drinks, is to improve public health by reducing SSB consumption, particularly among children and teens.

At the heart of the legislation is a tiered excise tax tied to the amount of sugar in the drink size. Beverages with less than 5 grams of added sugar per 12 fluid ounces will not be taxed; beverages with 5 grams to 19 grams of added sugar per 12 fluid ounces will be taxed at a rate of $.01 per ounce; and beverages with 20 or more grams of added sugar per 12 fluid ounces will be taxed at a rate of $.02 per ounce. (Increased portion sizes have contributed to the nationwide health problem: Soda bottles have grown from 6.5 ounces to 12-ounce cans to 20-ounce plastic bottles and super-sized two liters, a whopping 68 ounces.) In addition to the tax, the legislation includes a number of provisions to curb the marketing of sugary beverages to children.

Caroline Apovian, MD, Professor of Medicine at Boston University School of Medicine and director of the Nutrition and Weight Management Center at Boston Medical Center, would go one giant step further if she had her way. "Sugar-sweetened beverages shouldn't just be taxed; they should be outlawed," she says. "They're poison, especially for children and adolescents."

SSBs, essentially sugar and water, offer no nutritional benefit. "There is evidence that when you drink calories, especially in water, the satiety center in the brain doesn't register those calories," says Apovian. "It doesn't register fullness the way eating food does." And there's no chewing or digestion involved. "Sugar in water is very easily and quickly absorbed," she says. "If you're thirsty, you're going to down 12 ounces in no time."

Steven Gortmaker, professor at the Harvard T.H. Chan School of Public Health, has been studying the effects of sugary beverages on health, particularly its link to obesity in children, for about 20 years. "Sugar water, in all its forms, adds excess weight and increased risk of diabetes and cardiovascular disease," says Gortmaker, who's in favor of the excise tax. When the tax raises the shelf price of SSBs, he says, "It will move people away from those beverages to better choices." He likens it to the tax on cigarettes, which represented a powerful policy change.

Apovian would like to see SSBs regulated like alcohol: "We regulate alcohol and do not give alcohol to children."

Representative Kay Khan of Newton knows it's difficult to talk about taxes, but says this is really a serious health issue. She explains that Massachusetts doesn't tax sales of food, which includes sweetened beverages. "Sugary drinks should not be considered food," she says. Khan, a trained nurse, adds, "It's important to think about prevention. We did get the soda machines out of the schools, which was a step in the right direction, but we need to do more than that."

Other locales have enacted SSB taxes with good results. Berkeley, California, was the first U.S. city to implement one, in March 2015, and consumption of sugary beverages decreased 21% as more people started drinking water. Soon after, Philadelphia, Pennsylvania; Cook County, Illinois; Boulder, Colorado; California cities San Francisco, Oakland, and Albany; and Seattle, Washington, have implemented similar taxes. If Massachusetts approves the tax, it will be the first state to do so.

Outside the United States, Mexico taxed all non-alcoholic beverages with added sugar in January 2014, and, as a result, purchases decreased 5.5% in 2014 and almost 10% in 2015. France saw about a 6.7% decline in SSB consumption after implementing a tax in January 2012. Other European countries have followed suit.

In Massachusetts, the tax and resulting public awareness is not only expected to reduce SSB consumption, but the revenues, estimated to yield between $350 and $400 million annually, will be used for community projects designed to improve health outcomes. Senator Lewis explains that the money will be deposited in a new Children’s Health Promotion Fund for municipalities to install drinking water fountains in schools, parks, and playgrounds; support childhood nutrition programs in low-income communities; and expand various exercise, health and wellness programs. 

Harvard's Gortmaker calls the proposed bill a "win-win-win-win." Obesity, diabetes, and other chronic health problems will decline; the state's healthcare costs will decrease; tax revenues will go toward education programs and enhanced water availability; and the money people spend on these beverages can be used for something else. 

Resistance to the tax, as expected, comes from the beverage industry as well as big sellers of sodas, such as supermarkets and big chain drugstores. Lewis believes the tax will incentivize businesses to produce and sell beverages with less sugar. "Society at large has a huge stake in this," he says, as escalating healthcare costs are a problem that touches everyone. While the tax will likely have a greater impact on low-income residents, says Lewis, "the disease burden [caused by excessive sugar intake] falls overwhelmingly on poorer and more vulnerable communities." That's why the tax revenues will be dedicated back to those same communities.

Perhaps Professor Gortmaker sums it up best: If people change their diets, he says, "This is one of those taxes you don't have to pay."

The Soda Tax didn't make it into the Massachusetts' FY 2017-2018 state budget on its first try. So, what’s next for the Soda Tax? "Try again in the next budget cycle, " says David Martin, President of the Massachusetts Health Alliance and an advocate of the tax. "And then keep trying again and again until it works. It's the very definition of Public Health."

Kidding Around No Kidding

Kidding Around No Kidding

Tufts Online Graduate Program in Sustainable Agriculture and Food Systems

Tufts Online Graduate Program in Sustainable Agriculture and Food Systems