In the U.S., Connecticut’s governor is backing a proposed sweetener beverage tax of 1.5 cents per ounce—part of a series of taxes on e-cigarettes and related supplies, some bottled alcoholic beverages, and even plastic bags. The governor’s office estimates revenue for the sweetened beverage tax alone at around US$163 million in 2021. The state legislature did not pass a proposed tax of one cent in 2017.
California’s legislature is considering a series of bills targeting consumption of sweetened beverages, including a beverage tax, restrictions on displaying these beverages near checkout lines, warning labels on their packaging, a ban on discount coupons, and a 16-ounce limit on beverages sold by restaurants and other food-service establishments. In recent years, several soda tax bills before the state legislature all died in committee. According to one estimate, revenue from a tax of two cents per ounce could reach US$2 billion for the state; the details of this latest proposal are not yet set. Though several California cities have soda taxes in place, the state introduced a ban on new local sales taxes last year—under intense lobbying and other pressure from the private sector. Separately, health advocacy groups are working to put a soda tax up for a popular vote.
The government of Canada’s Northwest Territories is eliciting feedback on a proposed beverage tax of around 1.1 cents (U.S.) per ounce on packaged beverages. Fountain drinks would be charged on a scale, from 0.9 cents per ounce for beverages under 8.5 ounces to over 1.3 cents per ounce for those above 25 ounces. Canadian health advocacy groups are continuing to lobby for a national beverage tax.
Studies of the effects of soda taxes in the California cities of San Francisco, Oakland, and Berkeley seem to show mixed results. A recent study that found a decline of 50 percent in soda consumption in Berkeley relied on self-reporting by participants. On the East Coast, one study found that Philadelphia’s tax has cut sales of sweetened beverages by 46 percent. However, sales rose in nearby areas not covered by the tax. Taking that sales hike into account, the drop in Philadelphia’s sales was closer to 20 percent.
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