We study economic factors that drive eating decisions and test policies to reduce health disparities.
What impact did the Philadelphia beverage tax have on sweetened beverage purchases?
On January 1, 2017, Philadelphia began taxing the distribution of sweetened beverages at a rate of 1.5 cents per ounce. This policy was passed to raise revenue to support early childhood education and rebuild community infrastructure, but public health experts have wondered whether it could reduce consumption of sugary drinks. Sugary drinks are the leading source of added sugar in our diets, and they are linked to obesity, Type II diabetes, and dental cavities. On a given day, about half of Americans are drinking them.
We set out to understand the influence of the Philadelphia beverage tax on purchases of these drinks.
Methods
Our recent study, published in the Journal of the American Medical Association, examined the effect of the Philadelphia beverage tax on beverage prices and sales at almost 300 large chain retailers (supermarkets, mass merchandisers, and pharmacies) in Philadelphia and nearby counties.
Results
We found that in response to the price changes that resulted from the tax, customers reduced their purchases by 38%. That’s the equivalent of about one billion fewer ounces—or about 83 million fewer cans of soda—per year. And this is after accounting for the people who left Philadelphia to buy drinks in nearby counties.
Implications
Beverage taxes are one of the most promising policy strategies to reduce intake of sugar-sweetened beverages. For great resources on beverage taxes check out Healthy Food America and the Rudd Center tax revenue calculator.
