Mariah Baker, National Center for Health Research
The World Health Organization recommends Sugar-Sweetened Beverage Taxes (SSB taxes) as an effective way to reduce sugar consumption and decrease non-communicable diseases such as diabetes and heart disease. SSBs are drinks that are sweetened with some form of added sugar, including drinks such as soda, sports drinks, energy drinks, and prepackaged coffee and tea beverages. There are many different types of added sugar that may be in these drinks, including sucrose (table sugar), honey, and high fructose corn syrup.[1] Easy access to SSBs and the lack of healthier options increase the amount of SSBs consumed and increase the risk of obesity, diabetes, and heart disease, especially in populations already at risk. Communities are now looking for ways to incentivize healthier choices and decrease the high consumption of sugary drinks, and SSB taxes are one solution to this increasing problem.
What Are SSB Taxes?
SSB taxes are an increased tax on sugar-sweetened beverages, usually with the exception of 100% fruit juices, milk or milk-alternative products, baby formula, alcohol, and diet drinks. SSB taxes are intended to benefit populations in two ways. First, they aim to decrease the consumption of harmful beverages by making them less affordable. And secondly, the revenue made from the taxes goes back into the community. SSB taxes are one of the only public health policies that generate more revenue than they cost to implement, and the funding is usually used to finance public health or education programs. SSB taxes use a similar strategy to what was used to decrease tobacco consumption. For the tax to be effective, it needs to increase the price of SSBs enough to deter individuals from purchasing them. SSB taxes are considered excise taxes, which are different from standard sales taxes in that the tax is paid by the retailer instead of the customer. Most SSB taxes in the US are along the lines of one to two cents per ounce of beverage.[2]
Do SSB Taxes Work?
SSB taxes have been implemented in numerous countries, including Norway, Mexico, and England. As of 2024, no state in the US has a SSB tax, but seven localities do, including four cities in California, as well as Philadelphia, PA, Seattle, WA, Washington, D.C. and Boulder, CO. The most recent data examined changes in prices and purchases of sugar-sweetened beverages following SSB tax implementation in Boulder, CO; Philadelphia, PA; Oakland, CA; Seattle, WA; and San Francisco, CA from the time of implementation up to 2020. This study found that in the first two years following tax implementation, SSB purchases declined by an average of 33.0%. It also found that between 2012 and 2020, SSB’s had an average price increase of 1.3¢ per oz.[3]
Ever since these taxes were first implemented, research results on the impact on reduced consumption has been promising. Berkeley, CA became the first locality in the US to implement a SSB tax in 2015, passing a 1 cent per ounce tax, which resulted in an average price increase for customers of 0.47 cents per ounce.[4] In the first 6 years after the tax had been in effect, the limited data were promising. One year after the SSB tax was implemented SSB consumption had dropped by 21%. Three years after the tax was implemented, consumption had dropped by about 50%, and water consumption had increased by almost 30%.[4] The tax revenue during the first six years brought in about $1.5 million every year. Most of the revenue is used to fund nutrition education programs such as the Berkeley Unified School District’s Cooking and Gardening Program, which plants gardens on school campuses and teaches children about how food is grown.
In 2017, Philadelphia, PA established a SSB tax at 1.5 cents per ounce on beverages that were sweetened with sugar or artificial sweeteners (Philadelphia is the only area that has extended their tax to artificially sweetened beverages in addition to SSBs; see https://www.center4research.org/artificial-sweeteners-weight-safety/ on risks of artificial sweetener). [5,2] The tax led to a price increase between 0.65 cents per ounce and 1.56 cents per ounce, depending on which store the SSB was sold in.[5] One year after implementing this tax, researchers found that the purchase of SSBs decreased by 51% in larger stores and a separate study showed a decrease of almost 40% in small, independent stores.[2,6] However, their data also indicated that more SSBs were purchased in cities bordering Philadelphia, indicating that consumers may have been going outside of the city to purchase beverages that weren’t taxed. A more recent analysis by some of the same researchers examined purchasing trends at only the small independent groceries in Philadelphia, not large supermarkets.[7] They randomly evaluated sampled shoppers’ purchases on particular days, rather than adding all the purchases that individuals made during a specific week or month. Compared to shoppers in Baltimore, which does not have a sugar-sweetened beverage tax, Philadelphia shoppers’ purchases on those days contained 42% fewer ounces of sugar-sweetened beverages. When examining total purchases (not just beverages) of those shoppers on those days, the researchers also found that Philadelphia residents’ purchases had an average of 70 fewer calories and 20 fewer grams of sugar than Baltimore residents’ purchases following the implementation of the tax, compared with before. The decrease in purchases was most substantial in low-income communities. The impact of the taxes might be higher at the smaller, independent stores, since smaller stores are more likely to pass the entire tax onto customers, it is therefore possible that shoppers increased their purchases of sugar-sweetened beverages at the larger supermarkets, where prices are generally lower, including for beverages. The researchers also evaluated whether Philadelphia residents might have increased their shopping outside the city to save money on sugar-sweetened beverages, and the results indicated a small increase of just one shopping trip per month.
Seattle began their SSB tax in 2018. Researchers analyzed purchases made at supermarkets, and they compared the amount of sugar in sugar sweetened beverages sold before and after the SSB tax was implemented. They found that, on average, there was a 23% decrease in the total amount of sugar sold 2 years after the tax was implemented. The biggest reduction was in the amount of sugar sold in “family-sized” sodas.[8]
In 2022, a systematic review and meta-analysis looked at the impact of taxes on SSBs based on 62 studies conducted around the world.[9] When researchers conduct a systematic review and meta-analysis, they combine data from well-designed studies so that they can draw conclusions based on large numbers of patients who were evaluated in smaller studies. The review concluded that the SSB taxes were linked to 15% fewer ounces of these beverages being sold. This may not seem like a big decrease, but it is a larger impact than has been documented from raising taxes on tobacco and alcohol. Although the researchers found little change in the self-reported consumption of SSBs, self-reports are not as accurate as purchasing data. The authors also reported the taxes did not appear to have any negative overall impact on local economies.
Why Focus on SSBs?
SSBs make up the largest source of added sugar in the standard American diet. On average, U.S. adults consume almost 150 calories every day from SSBs.[1] Dietary Guidelines for Americans 2020-2025 suggests that added sugars should make up no more than 10% of your total calorie intake. The AHA recommends that men have no more than 36 grams (150 calories) of total added sugar per day and that women should consume no more than 25 grams (100 calories) of total added sugar per day. For context, most “single-serving” drinks sold in drugstores or gas stations are sold in 20-ounce bottles which can contain between 200-250 calories from added sugar (see the infographic below to learn how much sugar is in your favorite drinks). The problem with SSBs is that a single drink can often contain double the amount of daily recommended sugar!
Here are some examples of popular SSBs and their sugar content.
- 20-ounces of Coca-Cola – 65 grams of added sugar – 240 calories
- 20-ounces of Schweppes Ginger Ale – 54 grams of sugar – 210 calories
- 20-ounces of Gatorade – 34 grams of sugar – 130 calories
- 20-ounces of Lemon Snapple – 45 grams of sugar – 190 calories
- 13.7-ounces of prepackaged Starbucks Vanilla Frappuccino – 46 grams of sugar – 185 calories
While drinks sweetened with artificial sweeteners, such as Sucralose, Aspartame, and Saccharin, aren’t usually considered SSBs, they have their own set of drawbacks. Artificial sweeteners may also put someone at an increased risk for obesity, heart disease, and diabetes when consumed in large quantities. You can learn more about artificial sweeteners here.
What Are the Health Effects of Drinking Too Many SSBs?
Consuming too much sugar can have serious adverse health effects. SSBs are linked to increased weight gain, which is a significant risk factor for many chronic diseases. Currently, almost 70% of adults in the U.S. are overweight. Being overweight or obese leads to an increased risk for diseases such as Type II Diabetes, heart disease, and several different types of cancer. One study showed that just one to two SSBs per day has been linked to the development of diabetes.[13] Eating and drinking too much sugar isn’t only bad for your heart, weight, and blood sugar. SSBs also affect dental health, especially in young children. Drinking one to two SSBs per day could increase your risk of developing a cavity by over 30%, and babies between the age of 10 and 12 months that were given more than three SSBs per week had 83% higher odds of having a cavity by age six than those who were not given SSBs.[14,15]
The impact of these taxes on weight seems logical, but doing the studies is challenging. It wasn’t until 2024 that a study was published that provided good evidence. The study followed about 45,000 youth between 2 to 19 years old living in 4 California cities and found that youth living in cities with SSB taxes had significantly lower BMI compared with youth who lived in cities without SSB taxes.16 Participants were followed from 2009 to 2020, which included 6 years before SSB taxes were implemented and 4 to 6 years after tax implementation. The study found that participants younger than 12 years old, males, white and Asian youth, and youth with obesity experienced the most significant reductions in BMI, especially those who lived in the cities of Berkeley and San Francisco.These improvements were consistent across cities and different groups.
Several previous studies have projected possible long-term impact. A 2021 study in Mexico found that SSB taxes seemed to help reduce obesity in adolescent girls (though not boys).[12] Within 2 years of a city initiating a 10% or more SSB tax, researchers found a 3% decrease in the chance of an adolescent girl being obese or overweight. On average, the SSB tax was associated with weight loss of less than one pound, and that was only among the girls who had higher BMIs prior to the tax. Nevertheless, that small average weight loss resulted in a statistically significant difference that could be attributed to the increase in the cost of sugar-sweetened beverages, especially when prices increased by at least 10%. In 2020, the American Heart Association (AHA) published a health impact and cost-effectiveness analysis. The study estimates that a national, volume-based SSB tax would prevent 850,000 cardiovascular disease events (heart attack, stroke, etc.) and 269,000 cases of diabetes. The AHA also estimated that the tax could result in over $80 billion in tax revenue over a lifetime.[11] Similarly, a study published in 2024 suggests health benefits similar to those found previously. This study suggests that a 15-20% consumption decrease could lead to reductions in myocardial infarction events, ischemic heart disease, coronary heart events, strokes, diabetes, and obesity.[16]
Some Americans drink much more SSBs than others and so it is possible that the taxes will have more of an impact on some types of adults and children. Young people, males, lower-income individuals, and Black and Mexican Americans all consume more SSBs than their older, female, higher-income, and White counterparts.[1] One analysis shows that the richest 10% of Americans drink 2.5 fewer sugary drinks per week than the poorest 10%.[17] There are a few theories as to why this is, beginning with the fact that low-income neighborhoods often have less access to healthy food and those food choices that are established during childhood usually stick with people into their adult lives.[18] The different levels of consumption may contribute to health inequities. For example, low-income and Black and Mexican Americans have higher rates of diabetes and heart disease, which puts them at an even higher risk for chronic diseases related to SSBs.[19] In fact, the types of people most at risk for chronic diseases related to SSBs are the same types of people who are drinking the most of them. One study on the impact of the SSB tax in Philadelphia suggested that young adults, low-income Americans, and Black and Hispanic Americans would reap the most benefit from the tax. This is because the tax creates a greater financial strain for low-income populations than for higher-income populations, making low-income populations less likely to drink SSBs and thus improving their health.[2]
What’s The Argument Against SSB Taxes?
While there is plenty of research done on how SSBs contribute to poor health, not everyone agrees with implementing an SSB tax. Those who oppose the tax claim that it does little to lower overall sugar consumption. One argument is that people may stop drinking sweetened beverages but may fill in those missing calories with candy or other high-sugar snacks. Critics have also pointed out a lack of data, but the 2024 study cited above helps to put those criticisms to rest.However, more studies are needed over longer periods to show that SSB taxes prevent the types of obesity-related chronic diseases that are of greatest concern.
While SSB taxes have some proven benefits, they remain controversial. A few localities have passed SSB taxes only for them to be repealed soon after. For example, Cook County, IL, which includes Chicago, enacted a SSB tax in 2016, but it was repealed less than a year later. Other states, such as Arizona and Michigan, have preemptively blocked local governments from enacting future taxes. California is even more complicated. In 2018 California signed a law that prohibits local governments from adopting new SSB taxes, but the law did not affect SSB taxes that were already implemented in Berkeley, Albany, Oakland, and San Francisco.[20] In 2021, NCHR wrote to the California State Assembly to advocate for the repeal of this law. You can read the letter here. Fortunately, in 2023 California courts repealed the law in 2023 stating that local governments and residents have the right to decide for themselves if sugary drink taxes are right for their communities23
References:
- Centers for Disease Control and Prevention. Get the facts: Sugar-sweetened beverages and consumption. Cdc.gov. https://www.cdc.gov/nutrition/data-statistics/sugar-sweetened-beverages-intake.html#:~:text=Sugar%2Dsweetened%20beverages%20are%20any,%2C%20raw%20sugar%2C%20and%20sucrose. March 11, 2021.
- Bleich, S. N., Lawman, H. G., LeVasseur, M. T., Yan, J., Mitra, N., Lowery, C. M., … & Roberto, C. A. The Association Of A Sweetened Beverage Tax With Changes In Beverage Prices And Purchases At Independent Stores: Study compares changes in sweetened beverage prices and purchases before and twelve months after tax implementation, at small, independent stores in Philadelphia. Health Affairs. 2020; 39(7), 1130-1139. https://www.healthaffairs.org/doi/10.1377/hlthaff.2019.01058#:~:text=Sugar%2Dsweetened%20beverage%20(SSB),to%20several%20adverse%20health%20conditions.&text=Seven%20cities%20and%20counties%20in,to%202%20cents%20per%20ounce
- Kaplan, S., White, J. S., Madsen, K. A., Basu, S., Villas-Boas, S. B., & Schillinger, D. (2024). Evaluation of Changes in Prices and Purchases Following Implementation of Sugar-Sweetened Beverage Taxes Across the US. JAMA Health Forum, 5(1), e234737. https://doi.org/10.1001/jamahealthforum.2023.4737
- Falbe, J., Rojas, N., Grummon, A. H., & Madsen, K. A. Higher retail prices of sugar-sweetened beverages 3 months after implementation of an excise tax in Berkeley, California. American Journal of Public Health. 2015; 105(11), 2194-2201. https://pubmed.ncbi.nlm.nih.gov/26444622/
- Mckoy, J. (2024). Sugary Drink Tax Prompts Substantial Decline in Purchases. Boston University School of Public Health. https://www.bu.edu/sph/news/articles/2024/sugary-drink-tax-prompts-substantial-decline-in-purchases/
- Price, A. Do soda taxes work? PublicHealth.Berkeley.edu. https://publichealth.berkeley.edu/news-media/research-highlights/do-soda-taxes-work/ October 29, 2020.
- Roberto, C. A., Lawman, H. G., LeVasseur, M. T., Mitra, N., Peterhans, A., Herring, B., & Bleich, S. N. (2019). Association of a beverage tax On Sugar-sweetened and artificially sweetened beverages with changes in Beverage prices and sales at chain retailers in a large urban setting. JAMA, 321(18), 1799. doi:10.1001/jama.2019.4249
- Bleich SN, Dunn CG, Soto MJ, Yan J, Gibson LA, Lawman HG, Mitra N, Lowery CM, Peterhans A, Hua SV, Roberto CA. Association of a Sweetened Beverage Tax With Purchases of Beverages and High-Sugar Foods at Independent Stores in Philadelphia. JAMA Network Open. 2021 Jun 1;4(6):e2113527-.
- Powell LM, Leider J, Oddo VM. Evaluation of Changes in Grams of Sugar Sold After the Implementation of the Seattle Sweetened Beverage Tax. JAMA Network Open. 2021 Nov 1;4(11):e2132271-.
- Andreyeva T, Marple K, Marinello S, Moore TE, Powell LM. Outcomes following taxation of sugar-sweetened beverages. JAMA Network Open. 2022;5(6). doi:10.1001/jamanetworkopen.2022.15276
- Fletcher, J. M., Frisvold, D. E., & Tefft, N. The effects of soft drink taxes on child and adolescent consumption and weight outcomes. Journal of Public Economics. 2010; 94(11-12), 967-974. https://www.sciencedirect.com/science/article/pii/S0047272710001222
- Lee, Y., Mozaffarian, D., Sy, S., Liu, J., Wilde, P.E., Marklund, M., Abrahams-Gessel, S., Gaziano, T.A. and Micha, R. Health impact and cost-effectiveness of volume, tiered, and absolute sugar content sugar-sweetened beverage tax policies in the United States: a microsimulation study. Circulation. 2020; 142(6), 523-534. https://www.ahajournals.org/doi/full/10.1161/CIRCULATIONAHA.119.042956
- Gračner T, Marquez-Padilla F, Hernandez-Cortes D. Changes in Weight-Related Outcomes Among Adolescents Following Consumer Price Increases of Taxed Sugar-Sweetened Beverages. JAMA Pediatrics. 2021.
- Malik, V. S., Popkin, B. M., Bray, G. A., Després, J. P., Willett, W. C., & Hu, F. B. Sugar-sweetened beverages and risk of metabolic syndrome and type 2 diabetes: a meta-analysis. Diabetes care. 2010; 33(11), 2477-2483. https://pubmed.ncbi.nlm.nih.gov/20693348/
- Bernabé, E., Vehkalahti, M. M., Sheiham, A., Aromaa, A., & Suominen, A. L. Sugar-sweetened beverages and dental caries in adults: a 4-year prospective study. Journal of dentistry. 2014; 42(8), 952–958. https://doi.org/10.1016/j.jdent.2014.04.011
- Young, D. R., Hedderson, M. M., Sidell, M. A., Lee, C., Cohen, D. A., Liu, E. F., Barton, L. J., Falbe, J., Inzhakova, G., Sridhar, S., Voorhees, A. C., & Han, B. (2024). City-Level Sugar-Sweetened Beverage Taxes and Youth Body Mass Index Percentile. JAMA Network Open, 7(7), e2424822. https://doi.org/10.1001/jamanetworkopen.2024.24822
- Wang, Y. C., Coxson, P., Shen, Y.-M., Goldman, L., & Bibbins-Domingo, K. (2012). A Penny-Per-Ounce Tax On Sugar-Sweetened Beverages Would Cut Health And Cost Burdens Of Diabetes. Health Affairs, 31(1), 199–207. https://doi.org/10.1377/hlthaff.2011.0410
- Park, S., Lin, M., Onufrak, S., & Li, R. Association of sugar-sweetened beverage intake during infancy with dental caries in 6-year-olds. Clinical nutrition research. 2015; 4(1), 9. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4337927/
- Smith, P., & Zagorsky, J. L. Poorest Americans drink a lot more sugary drinks than the Richest – which is WHY soda taxes could help reduce gaping health inequalities. The Coversation.com. https://theconversation.com/poorest-americans-drink-a-lot-more-sugary-drinks-than-the-richest-which-is-why-soda-taxes-could-help-reduce-gaping-health-inequalities-142345 July 20, 2020.
- Kuczmarski MF, Mason MA, Schwenk EA, Evans MK, Zonderman AB. Beverage Consumption Patterns of a Low-Income Population. Top Clinical Nutrition. 2010; 25(3):191-201. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2957908/
- Artiga, S., & Orgera, K. Disparities in health and health CARE: Five key questions and answers. Kff.org https://www.kff.org/racial-equity-and-health-policy/issue-brief/disparities-in-health-and-health-care-five-key-questions-and-answers/ March 4, 2020.
- Urban Institute. Soda taxes. Urban.org https://www.urban.org/policy-centers/cross-center-initiatives/state-and-local-finance-initiative/state-and-local-backgrounders/soda-taxes May 13, 2020.
- (2023). California appellate court rules ban on local sugary drink taxes unconstitutional. https://www.thepraxisproject.org/blog/ca-ab1838