Study: Sugary drink tax appears to be equitable public policy

A University of Washington study about taxing sweetened drinks shows that a tax might be effective when it comes to addressing overconsumption and that it may be an equitable public policy.

>>Seattle City Council approves tax on soda, sugary drinks

The study examined several measures of a sweetened beverage tax’s economic equity impacts in three large cities: Seattle, San Francisco and Philadelphia.

>>Why some sugary drinks are exempt from Seattle’s new sugar tax

While consuming inordinate amounts of sugary drinks can lead to weight gain, diabetes, cardiovascular disease and other health issues, taxing sugared beverages has considerably reduced purchases of taxed beverages, according to multiple studies.

Nonetheless, many have questioned if taxing sugary drinks is equitable.

According to the study, the lowest-income households paid a larger proportion of their income on the beverage tax in comparison to middle- and higher-income households, resulting in a greater economic burden.

However, “the absolute level of annual per capita dollar amount paid on taxes did not differ by household income,” according to the study.

The study also determined that money collected from the tax went toward programs targeting low-income households, and the allocated money exceeded the amount of tax collected from lower-income populations, “resulting in a net transfer of revenues paid by higher-income populations to the programs.”

“Thus, when considering both population-level taxes paid and sufficiently targeted allocations of tax revenues, a sweetened beverage tax may be an equitable public policy,” the study concluded.

For exact details of this study, click here.