Taxing sugar-sweetened beverages by the amount of sugar they contain, rather than by the liquid volume of these drinks, as several U.S. cities currently do, could produce even greater health benefits and economic gains, according to a study published in Science.
Seven U.S. cities currently tax sugar-sweetened beverages, or SSBs, by the volume of the beverage—levies that don’t take into account the amount of sugar these drinks contain.
“Despite their different sugar content and resulting different harms, all sugar-sweetened beverages are taxed at the same rate per liter under a volumetric tax,” wrote the researchers. “This tax structure gives consumers no incentive to substitute from high-sugar to low-sugar SSBs, even though the latter are less harmful. Thus, while a volumetric tax reduces consumption of SSBs in general, it does not provide the maximum possible health benefits.”
The researchers note, however, that a tax on liquid volume is beneficial. They estimate, for instance, that a 34-cent/L volumetric tax causes the average U.S. adult to drink 2.9 fewer ounces of SSBs per day, a 22% reduction. This decrease in sugar intake would help the average adult to lose 2.3 pounds. In addition, a nationwide volumetric SSB tax would reduce obesity rates by 2%—a 2.1 million decline in adults with obesity—and would lower the number of new Type 2 diabetes cases by 2.3%, or approximately 36,000 new cases per year.
However, in their assessment, a tax on the amount of sugar in SSBs would yield even greater health and economic gains. Such a tax would cause U.S. adults to consume 2.3 fewer grams of sugar per day from SSBs than they would under a volumetric tax, helping the average adult lose an additional 0.7 pounds. Across the United States, a sugar tax instead of a volumetric tax would reduce obesity rates by an additional 630,000 adults and would cut the number of new type 2 diabetes cases by another 0.7%—or approximately 11,000 people per year.
“Once there is agreement to tax SSBs, it seems natural to tax the harmful sugar, instead of the liquid that comes with the sugar,” the authors concluded. “Our calculations suggest that this idea offers valuable low-hanging fruit for improving public health.”