Last week five more jurisdictions joined Berkeley and Philadelphia in imposing special taxes on soda and other soft drinks. Four of the taxes were approved on Election Day by voters in Boulder, Colorado, and three California cities: San Francisco, Oakland, and Albany. The fifth was approved last Thursday by the Cook County, Illinois, Board of Commissioners.
Boulder’s Ballot Issue 2H, which Eric Boehm noted last week, passed with 54 percent of the vote. It imposes an excise tax of two cents per fluid ounce on drinks that have five or more grams of added sugar in a 12-ounce serving. It does not apply to alcoholic beverages or milk products.
San Francisco’s Measure V, which passed with 62 percent of the vote, imposes a one-cent-per-ounce excise tax on sugar-sweetened beverages that contain more than 25 calories per 12-ounce serving. Milk products, baby formula, and meal-replacement beverages are exempt.
Cook County, which includes Chicago, has 5.2 million residents, making it the most populous U.S. jurisdiction to approve a soda tax so far. Unlike the four 2016 ballot initiatives but like Philadelphia’s tax, the one-cent-per-ounce levy approved by Cook County last week applies to artificially sweetened beverages as well as soft drinks with added sugar. That approach broadens the base, raises more money, and makes the tax a bit less regressive (since consumption of sugar-sweetened drinks is especially common in low-income households, while wealthier consumers are more likely to favor diet versions). But it means drinks with zero calories (such as Diet Coke) get hit with a special tax that does not apply to drinks (such as fruit juice) that are just as fattening as regular soda. Taxing beverages without regard to calorie content makes a hash of the already dubious argument that soda taxes will reduce obesity by driving down total calorie intake.
If passed through to consumers, the one-cent taxes will add 68 cents to the cost of a two-liter bottle and $1.44 cents to the cost of a 12-pack. Boulder’s two-cent tax adds $1.36 and $2.88, respectively.
“We understand the health threats posed by unhealthy sugary drinks, especially on low-income families,” said Angelique Espinoza, manager of the Boulder soda tax campaign, after the initiative passed. “Today Boulder took an important, proactive step toward ensuring that all of us—our children in particular—have every opportunity to make better choices and to lead healthy lives.”
The Boulder Weekly had a different perspective: “We oppose 2H with exactly the same line of logic as we use to oppose Amendment 72 [a proposed tobacco tax increase that failed last week]. This is a sin tax that provides money for beneficial programs on the backs of a small segment of the population. We reiterate that sin taxes are regressive, and research shows they do little to curb consumption or improve public health. We hate it when people call Boulder a ‘nanny state.’ We hate it more when they are right.”