Of Course Soda Taxes Don’t Work on Their Own

A new study says taxing junk food hurts the poor—but public health advocates see such laws as one part of a larger solution.

(Photo: Justin Sullivan/Getty Images)

Mar 5, 2015· 3 MIN READ
Steve Holt is a regular contributor to TakePart. He writes about food for Edible Boston, Boston Magazine, The Boston Globe, and other publications.

Duck into any corner convenience store on Boston’s Columbia Avenue, Baltimore’s North Avenue, or Dallas’ Pennsylvania Avenue, and you’ll see many of the same products: shelves full of salty potato chips, cookies, and other processed foods, and plenty of soda. What you won’t see are many healthy options, namely fruits and vegetables.

The toll living in this retail landscape takes on the health of local residents is well documented: ever-rising rates of obesity, heart disease, childhood diabetes, and a host of other diseases closely tied to diet. Solutions generally include increasing access to fresh, healthy food, as well as public awareness and educational campaigns. In public health circles, additional taxation on sugar-sweetened beverages has gained traction as a way to make Americans think twice about purchasing unhealthy drinks, thus lowering consumption.

But does it? In a paper published Tuesday by researchers at George Mason University’s Mercatus Center—a libertarian-leaning research center backed financially by conservative magnate Charles Koch—says not only do so-called “sin taxes” not lower consumption of the foods and beverages they intend to discourage, but they may make poor people poorer. The paper argues that soda and junk food taxes are regressive, disproportionately impacting lower-income Americans. When the price is raised on their favorite junk foods through a tax, these consumers may simply pay more for those foods if not given an alternative.

“We’re trying to teach this point that people in certain scenarios don’t have this full set of options, and their behaviors aren’t going to change as much as you think,” says Michael Thomas, assistant professor of economics at Creighton University and one of the paper’s coauthors. “If they don’t switch, then we’re just collecting money from poor people—we’re picking the pocket of people who can’t afford it.”

But prominent public health and nutrition experts say taxes on certain products, primarily sugary drinks, do work. They point to research such as a 2009 study published in the Journal of Public Economics that links soda taxes with moderate decreases in consumption. And just a few months into Mexico’s taxation of sugary beverages, preliminary reports suggest that consumption of soda had already dropped by as much as 10 percent. But absent a comprehensive menu of policy solutions, including localized ones, tax-induced behavior changes are unlikely to stick, says Marion Nestle, a professor of nutrition, food studies, and public health at NYU.

“Education has to be accompanied by changes in the food environment that promote healthier choices,” she says. “These include taxes but also such changes as school food standards, menu labels, restrictions on food marketing to kids, price and subsidy adjustments, incentives for buying fruits and vegetables, and other such interventions.”

She thinks many of the changes to our food system, including the way food is produced, marketed, and sold, should come from the highest levels of the United States government. But in a political climate where Republicans quibble with modest school lunch standards that work, we are likely a ways off from seeing such policy. In the meantime, the best hope for residents in communities with food-access issues may be within their own cities and neighborhoods, where innovative entrepreneurs, forward-thinking urban farmers, and conscientious elected officials are making room for an influx of fresh food to urban centers.

Boston was the nation’s first city to allow people on food stamps to redeem benefits at farmers markets—a program that has been replicated across the country. In Baltimore, where 20 percent of the population lives in a food desert, mobile farmers markets take fresh food into the far corners of the city. City government is also at work in Charm City, mapping areas with limited access to healthy food and creating new policies based on that research. In impoverished South Dallas, grocery stores are making a meaningful return to neighborhoods, and residents are beginning to grow their own food at Bonton Farms.

Medical institutions play a part as well, thanks in part to Obamacare. While hospitals have been working for environmental changes in their communities for years, the Affordable Care Act calls for nonprofit hospitals to conduct regular community health assessments and devote funds to “prevent illness, to ensure adequate nutrition, or to address social, behavioral, and environmental factors that influence health in the community.”

Recent policies aimed at ridding hospital cafeterias and vending machines of junk may also inform the soda tax conversation, says Roberta Friedman, director of public policy at the Rudd Center for Food Policy and Obesity at the University of Connecticut—and show cities and neighborhoods how they can make it easier for residents to be healthy.

“This is giving the message to people, ‘Here’s what we’re offering you. We’re not going to contribute to an unhealthy lifestyle. If you need to have a bag of chips’ ”—or a soda—“ ‘you need to go off the campus,’ ” she says.

In many ways, passing a junk-food tax in a vacuum may seem like the economic equivalent of opening a grocery store in a food desert and walking away. As another recent study found, doing so did nothing to change the diet of children in one Bronx neighborhood. In isolation, a soda tax is regressive and targets the poor. But the country’s first-ever soda tax is about to be implemented in Berkeley, California, a city that embodies the kind of comprehensive approach advocated by the likes of Nestle. In addition to the voter-approved tariff, Berkeley’s city government is focused on supporting the regional food system, democratizing (and subsidizing) access to healthy food, and promoting educational and community outreach efforts.

As the authors of the George Mason paper suggest, the tax could represent a burden on low-income residents—but the city’s overall food policy platform seems geared to making sure that isn’t the case.