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    Soft Drink Tax Debate Rages On

    The proposed tax on sugar-laden soft drinks as a way to fight obesity and fund health care reform is causing a stir with legislators, manufacturers, doctors and scientists, who are all debating the idea’s benefits and consequences.

    The proposed tax on sugar-laden soft drinks as a way to fight obesity and fund health care reform is causing a stir with legislators, manufacturers, doctors and scientists, who are all debating the idea’s benefits and consequences.

    A New York Times report said President Obama said it is worth considering, while the chief executive of Coca-Cola recently called the idea outrageous, and skeptics question how much of an impact it would really have on consumers. The tax would apply to soft drinks, energy drinks, sports beverages and many juices and iced teas, but not sugar-free diet drinks.

    Muhtar Kent, chief executive of Coca-Cola, said in a Bloomberg News report: "I have never seen it work where a government tells people what to eat and what to drink." He added: "It if worked, the Soviet Union would still be around."

    A group of doctors, scientists and policy makers, though, have argued the tax could be a weapon to reduce obesity, similar to the way cigarette taxes have helped curb smoking. Members of this camp include the New York City health commissioner, Thomas Farley; and Joseph W. Thompson, Arkansas surgeon general. They estimate a cent tax per ounce on sugary beverages would raise $14.9 billion in its first year, to be spent on health care initiatives, while also lower consumption of soda and lead to weight loss and reduced health risk for some Americans, the report stated.

    John Sicher, publisher of trade magazine Beverage Digest, said a 2-liter bottle of soda sells for roughly $1.35, and if the full proposed tax was passed on to consumers, it would add 50 percent to the price. A 12-can case, which sells for approximately $3.20, could rise by $1.44, a 45-percent increase.

    "A one cent per ounce tax would create serious problems and potentially adversely impact sales for the American beverage industry," Sicher told the newspaper.

    A supporter of a beverage tax also said it was not clear if it would have a tangible effect on Americans’ weight problems

    "I think we should be satisfied that soda taxes would be having a modest effect on consumption but would generate billions of dollars that could be used to mount public health campaigns," Michael Jacobson, executive director of the Center for Science in the Public Interest, an advocacy group that favors such a tax, told the Times.

    He noted if the tax was levied on the soft drink manufacturers, they might be able to spread the cost among their products, from chips and granola bars to diet sodas, which would keep consumers from feeling the full impact.

    - Nielsen Business Media

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