Soda
taxes may spread if voters check ballots in California,
Colorado
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[November 04, 2016]
By Chris Prentice
NEW YORK (Reuters) - As Americans vote for
a new president on Tuesday, hundreds of thousands of voters in
California's Bay Area and Boulder, Colorado, will also decide whether
they want levies on sugary drinks, another step toward making soda taxes
a norm.
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Three cities in California - San Francisco, Berkeley and Albany -
and Boulder, Colorado, have become the latest battleground in a
so-called "War on Sugar" that centers on sweetened drinks. Over
800,00 voters will decide on ballot measures to introduce taxes of 1
or 2 cents per ounce on soft drinks on Nov. 9, just weeks after the
World Health Organization (WHO) advocated that governments should
impose these types of levies.
The push for taxes on sugar and sodas has gathered momentum this
year, as officials and health advocates seek ways to stem health
epidemics of diabetes and obesity. On most ballots, the tax would
not apply to diet sodas but does affect some juices, sports drinks
and other beverages with added sugar.
Reducing consumption of sugary drinks is seen as a relatively easy
way for people to cut down on added sugars, recommended by groups
including the WHO, the U.S. Food and Drug Administration (FDA) and
the American Heart Association.
The trend has prompted worry and millions of dollars in advertising
and lobbying campaigns from beverage industry giants like PepsiCo
Inc and Coca-Cola Co that are facing declining sales of their
flagship products in markets including the United States.
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So far this year, Britain and Philadelphia decided to introduce
levies on soft drinks and countries including South Africa have
proposed similar measures. This follows a decision by Mexico to
introduce such a tax in 2014. The broadening of these efforts raises
the prospect of establishing them as the norm after numerous
previous attempts failed, advocates say.
"The more these taxes pass, the more they will be considered in
other jurisdictions," said Jim O'Hara, health promotion policy
director with the Center for Science in the Public Interest in
Washington.
SODA ON THE DEFENSIVE
Both Pepsi and Coke have are increasing options for less sugary
drinks, responding to changing consumer tastes. Consumption of
carbonated soft drinks hit a 30-year low in the United States last
year, as water sales continued their climb, according to Beverage
Digest.
The majority of California voters support government measure to
reduce consumption of sugary beverages, according to a Field Poll
released in February. In San Francisco, a 2014 vote for a similar
tax failed to pass a two-thirds vote, but is expected by many to
succeed this time around, as only a simple majority is required. The
votes in the other cities are expected by both advocates and
opponents alike to be tighter.
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Fighting for survival, Big Soda has been outspending advocates of
the measure, but not by much. Industry spending to oppose the taxes
this year in the Bay Area alone has swelled to around $27 million to
$28 million, versus around some $19 million by advocates, according
to estimates from both sides.
Billionaires including Michael Bloomberg have joined the fray,
contributing $15 million to pro-tax campaigns in the Bay Area. The
former mayor of New York waged an unsuccessful campaign in the city
to cut soda sizes in 2014.
Opponents say the tax, which would be levied on distributors, is
unfairly targeted at drinks makers and could raise food costs beyond
just soda.
"In effect, this is a grocery tax. It could be spread out on many
items" by distributors, said Joe Arellano, spokesman for the "No
Grocery Tax" campaigns in California's Bay area.
In the California cities, the measures would introduce a
penny-per-ounce tax. In Boulder, it would be 2 cents.
It is unclear how long-lasting the impacts of such taxes would be,
but some early research on such taxes in nearby Berkeley and in
Mexico suggest partial pass-through of the taxes from businesses to
customers and an impact on consumption.
(Reporting by Chris Prentice; Editing by Lisa Shumaker)
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