Soda Tax Aims to Fizzle Consumption

Michen Dewey | The PHOENIX

Soda is important to senior bioinformatics major Danny Baghdan. The 21-year-old said that he drinks at least one can a day. But he and other students might want to reconsider their soda purchases in the near future.

Earlier this month, the Cook County Board of Commissioners approved a tax on sugary drinks, which include soda, juices, energy drinks and any other non-alcoholic beverages that have added sweetener. The tax is expected to go into effect starting in July of next year.

The tax will add one penny per ounce to the cost of beverages containing sugar or artificial sweeteners. A 2-liter bottle of soda contains 67.6 oz., which the tax would round up to an additional 68 cents.

Soda taxes are not a new phenomenon. The first soda tax in the United States was passed in 2014 in Berkeley, California. As a result, consumption of sugary beverages in the city dropped 21 percent, and there was an increase in water consumption, according to a study by the University of California Berkeley. Similar taxes were also approved this year in San Francisco; Oakland, California; and Albany, New York.

The main purpose of taxing sugary drinks is to decrease consumption and reduce obesity and diabetes, according to the World Health Organization.

President of the Cook County Board of Commissioners Toni Preckwinkle proposed the tax in October to help balance the city’s 2017 budget.

Taxes on other unhealthy substances have yielded positive results. Statistics from the Congressional Budget Office showed that increasing the price of cigarettes by 50 cents was effective in decreasing smoking in young people and adults.

Timothy Classen, an associate professor of economics at Loyola, explained that the price change consumers will see may not be as severe as some may think. He said in Berkeley, half the soda tax was passed on to consumers via increased prices, and the producers of sugary drinks paid the other half.

Bob Fuller, a staff assistant at the 49th Ward office, wrote in an email to The Phoenix that businesses can profit despite the tax.

“If the tax is effective and discourages price-sensitive consumers from purchasing as much or any sugary beverages, retailers will likely see a decrease in business,” Fuller said. “However, savvy retailers might replace products subject to this tax with other products consumers might want and may have a better profit margin.”

Mike Malkowski, the manager of Go Grocer on Sheridan Road, does not anticipate the tax having a negative impact on his business.

“When people want to drink something or want [an item], they’re always going to go for that item over the healthier option,” Malkowski said.

Manager of Felice’s Kitchen and third-year environmental science major Erin DeFrancesco said the tax could affect profit margins when it goes into effect.

“We don’t actually get a lot of people ordering beverages with their food, anyway,” said the 20-year-old. “It’s kind of a bummer because it used to be such a high profit margin when you sell soda from a fountain. You [would] get pretty much all of the profit from it.”

Still, Baghdan said the tax won’t stop him from buying soda, and he doesn’t think it will stop others, either.

“If you want people to stop drinking sugary drinks instead of punishing them for doing so, you should probably let them choose themselves,” Baghdan said. “Teach them how to make an informed decision rather than punishing them for their decision in the first place.”

Sophomore social work major Reem Elshafei said she believes the extra cost will give people the incentive to drink fewer unhealthy options.

“I don’t really see the necessity for sugary drinks,” said the 19-year-old. “It doesn’t make me feel good, and I think if there was a price increase, people would feel a little less inclined to buy it.”

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