Fight Obesity? Simple: Add 1 Cent Sales Tax for Every Ounce of Soda

Proposals for a hefty soda tax though have repeatedly fallen flat. The idea was even floated as a way to help pay for health care reform, but government officials last week said that's not likely to happen.

The experts' plan was released by the influential New England Journal of Medicine, in a health policy article by Arkansas' surgeon general, New York City's health commissioner and five national experts on health and economics.

A soda tax would generate tax revenue while discouraging people from consuming extra calories, the authors contend. They cited a series of studies that showed higher rates of obesity and diabetes among women who drank more sugar-sweetened beverages. They argue that a steeper soda tax would borrow the same strategy that helped drive down cigarette smoking while bolstering government revenues.

But a golden opportunity for enacting a national soda tax apparently slipped away last week, when the Senate Finance Committee released its health reform proposal without a previously considered soda tax provision.

The House of Representatives' health reform bill also is without a soda tax. And a White House spokesman said President Barack Obama is not going to ask Congress to put a soda tax in.

The politics of health reform are too delicate right now to provoke an attack from the sugar and beverage industries, said Kenneth Thorpe, a health policy researcher at Emory University.

"They're at such a fragile place, introducing anything new and big like that into the mold is not likely to happen," said Thorpe, who served as a federal health policy official under President Bill Clinton.

Taxes on soda aren't new -- 33 states charge sales tax on soft drinks. But generally they are fairly small, with the average soda tax rate being 5.2 percent. On a 12-ounce can of soda that costs $1, that translates to about 5 cents.

The latest proposal in last weeks issue of the medical journal calls for a 1-cent-per-ounce sales tax, an amount more than double the average state tax. It would increase the levy on that $1 soda can to 12 cents.

A national tax of that amount would generate nearly $15 billion in its first year. The money could be used for child nutrition and obesity prevention programs, the authors suggested. The tax also would lead to a yearly 2-pound weight loss for soda drinkers, on average, they estimated.

But the beverage industry will no doubt fight a legislative proposal like that, Brownell and others said. PepsiCo threatened to move its corporate headquarters out of New York before that state dropped efforts to implement an 18-percent sales tax on sweetened beverages, they noted.