Soda Taxes Win Big In California

Three Bay Area cities proposed a 1-cent-per-ounce tax on sugar-sweetened beverages
The local measures proposed a one-cent-per-ounce tax on sugar-sweetened drinks like these.
The local measures proposed a one-cent-per-ounce tax on sugar-sweetened drinks like these.
Mike Blake / Reuters

Northern California cities San Francisco, Oakland and Albany passed so-called soda tax proposals Tuesday night, strengthening the Bay Area’s role as a leader in regulating residents’ consumption of sugar-sweetened beverages.

San Francisco’s Proposition V, Oakland’s Measure HH and Albany’s Measure O1 proposed a 1-cent-per-ounce tax on the distribution of most sugar-sweetened beverages, with exemptions for diet sodas, 100-percent fruit or vegetable drinks, alcoholic and milk beverages, infant formula and medical-use drinks.

The proposals in San Francisco and Oakland were among the most expensive races on the California ballot. Campaigns for and against the two proposals outspent campaigns for the state’s Senate race and statewide referendums on marijuana legalization and gun control combined, The New York Times reported.

Supporters of the taxes noted that sugary beverages are one of the greatest contributors to obesity, diabetes and tooth decay ― especially among children, whom they say the beverage industry targets most with its advertisements.

While research on how soda taxes affect consumption is still limited due to the small number of cities where such a tax has been implemented, findings suggest the increased price is in part passed on to retailers, who then pass it on to consumers, who are disincentivized by the higher price. One study found that as much as 70 percent of the tax may be passed onto consumers, while another found that it may be as low as 22 percent.

Opposition to the taxes, which was largely bankrolled by the American Beverage Association (ABA), a trade group, centered its campaign around how it would be passed onto consumers and framed it as a “grocery tax” that retailers could pass onto any items, not just sugary beverages. Supporters of the taxes argued that there’s no evidence of that happening.

“We respect the decision of voters in these cities,” the ABA said in a statement released Wednesday. “Our energy remains squarely focused on reducing the sugar consumed from beverages – engaging with prominent public health and community organizations to change behavior. We’re driving this change across America, including communities with the highest rates of obesity. It’s the hard work necessary for true and lasting change.”

This was the San Francisco Bay Area’s second go at implementing soda taxes in the region. In 2014, Berkeley voters passed the nation’s first soda tax, while a similar 2-cent-per-ounce sugary beverage tax proposal failed in San Francisco that year. This past June, Philadephia passed a soda tax through its city council.

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