Thursday, May 14, 2009

Taxing Soda

I've stated in the past here that I'm not a big fan of regular soda.

But how much of an affect would there be on sales of soda if there were a tax specifically on high calorie drinks like regular soda, energy drinks, etc.?

This article talks about how that is being entertained in the conversations among lawmakers as they try to take on the healthcare issues in the United States:

The Center for Science in the Public Interest, a Washington-based watchdog group that pressures food companies to make healthier products, plans to propose a federal excise tax on soda, certain fruit drinks, energy drinks, sports drinks and ready-to-drink teas. It would not include most diet beverages. Excise taxes are levied on goods and manufacturers typically pass them on to consumers.


How much would the tax be?:

The Congressional Budget Office, which is providing lawmakers with cost estimates for each potential change in the health overhaul, included the option in a broad report on health-system financing in December. The office estimated that adding a tax of three cents per 12-ounce serving to these types of sweetened drinks would generate $24 billion over the next four years.


Three cents? I think you can look at this in two different ways. It's three cent more for every 12 ounces so a normal 20-ouncer would cost an extra 5 cents. I guess if the argument is that it's going to generate $24 billion over 4 years towards changes to a health care system that is in need of changes, then it seems like a small price to pay.

But at the same time, let's not go to the extremely laughable argument like this:

Proponents of the tax cite research showing that consuming sugar-sweetened drinks can lead to obesity, diabetes and other ailments. They say the tax would lower consumption, reduce health problems and save medical costs.


I highly doubt that anyone is going to drop their 2 a day Mountain Dew addiction because the price of each one goes up 5 cents. So please, let's not try with a straight face that this is being proposed to get people healthier, it's being proposed to raise revenue for health care changes.

Want to discourage people from drinking soda with a tax? Make it a two dollar a bottle tax and then you might get some people that'll give up the habit if it's going to cost them $4 for a 20-ouncer.

It seems this approach might be better:

"Taxes are not going to teach our children how to have a healthy lifestyle," said Susan Neely, president of the American Beverage Association. Instead, the association says it's backing programs that limit sugary beverage consumption in schools.


Get the soda machines out of the schools, stop the daily menu of high calorie pizza and burritos in the school cafeterias and create required classes in school that focus on health and nutrition. That's going to go a much longer way in truly fighting against the obesity epidemic than three cents.
www.leanbodyfitness.com
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