Soda tax may bring small weight loss, large revenues

Taxing sodas and other sweetened beverages could trigger a small amount of weight loss and could also raise revenues to pay for other anti-obesity measures, claims a new study in the Archives of Internal Medicine.

Researchers at the Duke-National University of Singapore (NUS) Graduate Medical School calculated that adding a sales tax of 20 percent to sugar-sweetened beverages could result in a daily average reduction of 6.9 calories per person which, over the course of a year, would equate to about 0.7 pounds in weight loss. A 40 percent tax would result in a 12.5 calorie reduction, and annual weight loss of about 1.3 pounds per person.

In addition, the authors approximated that applying such taxes throughout the United States could generate an annual $1.5bn or $2.5bn in tax revenue respectively.

Lead researcher Eric Finkelstein said: “Although small, given the rising trend in obesity rates, especially among youth, any strategy that shows even modest weight loss should be considered.”

The research comes at a time when several states have been considering taxing sugary soft drinks as a way to plug budget deficits, as well as to tackle the nation’s obesity problem. According to figures from the Centers for Disease Control and Prevention, about 17 percent of children and nearly 27 percent of adults are obese.

A 40 percent sugared beverage tax would cost the average household an extra $28 a year, the researchers found, although higher and lower income groups would feel the impact of a tax less than middle-income families, Finkelstein said.

“Higher income groups can afford to pay the tax so they are unaffected, and lower income groups likely avoid the effects of the tax by purchasing generic versions, waiting for sales, buying in bulk, or by other cost-saving strategies,” he said.

Previous research has also suggested that even a small amount of weight loss could be beneficial for many Americans. A recent study from the US Department of Agriculture’s Economic Research Service (ERS) found that caloric sweetened beverages are disproportionately consumed by overweight people and suggested that because many individuals are overweight or obese by only a few pounds, even a small weight loss would shift them to a different weight bracket. The ERS report noted that 10.6 percent of overweight adults consume more than 450 calories a day from calorically sweetened beverages – nearly three times the average of 152 calories.

But the beverage industry has consistently argued that it is unfair to single out sugary beverages as the sole cause of obesity, and that taxing them is highly regressive.

Source: Archives of Internal Medicine

Vol. 170, Issue 22, pp. 2028-2034

“Impact of Targeted Beverage Taxes on Higher- and Lower-Income Households”

Authors: Eric A. Finkelstein, Chen Zhen, James Nonnemaker, Jessica E. Todd.